Are my projects profitable?
Cash flow forecasting tool for project accounting
Cash flow forecasting is crucial for every business, but project-based businesses may feel particular pain when trying to keep track of all the moving parts. We’ve created a brand new feature to help you better manage your money and plan for the future.
What is project accounting?
Project accounting is defined as any accounting executed on a project-by-project basis. It differs from company-wide accounting as it focuses on tracking all the moving parts of a project. This way you can ensure the project stays within budget, billing is accurate and gives you visibility of a project’s profitability.
Is this cash flow tool for me?
- Do you run a project-based business and struggle to know if you’re going to have enough money to pay your fixed cost such as salaries?
- Do you want to understand the outcomes of winning or losing a new contract?
- Do you need to report on the cash flow of projects to other stakeholders, funders or investors?
If any of the above sounds like problems you’re trying to solve, then this could be the right tool to forecast cash for your project-based business.
Float has developed a new feature to help businesses with precisely these challenges. We’ve listened to our customers explain how they wish to visualise their cash flow for the whole business and for project accounting, and we are implementing and iterating this continuously.
Why do project-based businesses need cash flow forecasting?
Businesses that have lumpy or fluctuating cash flow will find using a forecasting tool invaluable in planning out projects, and being able to make difficult decisions when cash is running low. Most people turn to cash flow when money is running out, but it should be used as a way to help you grow your business and make your projects profitable as well.
Our Float customers are from many industries, but in the continuous development of our projects based feature, we’ve zoomed in on those who are running IT-based, construction, property, manufacturing and agency projects. One thing that these industries have in common is that they tend to be project-based. For businesses that move from project to project, it can be difficult to maintain a smooth, healthy cash flow.
When cash levels dip, it may mean that there’s no recurring revenue to pay your fixed costs such as staff wages. A lack of funds in quieter months can lead to an inability to carry out critical tasks. And when cash is surplus, owners might not have the confidence to make additional hires, but forecasting and using the scenario planning feature within Float will allow you to make these choices.
“I set up my new company last year and having used Float previously, I knew to go to them for cash flow forecasting again. I run projects that have a life of 3-6 months, needing to forecast cash and understand my runway during that time. I need to understand my profitability to keep the projects afloat. The new projects feature within Float will allow me to track projects more effectively than before.” – Float Customer
For further information, we have a handy help article in case you get stuck building out your budgets by project!
