It’s common to hear: “We’re profitable on paper, so why is cash tight?” The gap between accrual profit and bank balance is one of the most useful places to diagnose how a business is really running.
Timing and recognition
Revenue and expenses don’t always move in sync with cash. Longer payment terms, deposits, prepaid costs, and inventory builds can all make the P&L look healthier than the checking account for a season — or the reverse.
Where we start
A simple rolling cash outlook, mapped against receivables, payables, and recurring obligations, usually surfaces the story faster than another month of guessing. From there, you can prioritize pricing, terms, or cost actions that actually change the bank balance.
This article is general information only, not advice for your business. For recommendations suited to your situation, get in touch.