‣ Finance:
Financial reporting is crucial as it will: � Measure the financial performance and establish future planning. �
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Indicate the social start up ‟ s strengths and weaknesses so the participants can capitalise on the strengths and correct the weaknesses.
Form the base on which the participants can forecast and monitor progress. Forecasting is critical as the cost of increasing sales will happen before they actually make the sales!
Provide the performance information required by themembers and / or sponsors. The participants will have to demonstrate to them that their investment in the social start-up was a wise decision.
� Indicate how financially healthy thesocial start up is!
The most important financial tools are the Cash Flow, Cost Benefit Analysis, Break Even Analysis, Operational Gearing, and Pricing. These are presented in the rest of this section.
� Cash Flow
This is a record of all actual and forecasted costs, expenses and receipts. It is really important to begin with a Cash Flow statement that forecasts costs / expenses, receipts and income for the duration of the Social Start-Up Training Programme. Later in the programme, the participants can expand the Cash Flow statement to forecast the 12 months after the spin-off phase.
Encourage the participants to search for free dynamic and other Cash Flow templates on the internetso they can find one that suits the best. For convenience, an Excel dynamic cashflow template is available through this programme for the participants ‟ use. When completing the Cash Flow forecast, please remind the participants to be as realistic as possible and consistently detailed. To begin with, ensure that theyinsert all known and regular payments( if any) such as monthly wages, rent, insurance etc over the next six months.
If there is a computer and overhead projector available, then please share the EXCEL Cashflow template with the participants now so they can start populating it.
Please ensure that you give a copy of the EXCEL file to the participants, especially those responsible for the social start up’ s financial planning and documentation.
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