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December 1, 2020

2020 P2Pv Session: CFO Perspectives on Liquidity and Cash Flow in Managed Services


For this 2020 Pivot to Profit Virtual (P2Pv) session, we rounded up integration firm CFOs to offer perspectives on understanding liquidity and cash flow in managed services. 

Watch the full session here

2020 P2Pv Presenters:

During the past year, as integration companies battled through the pandemic, it has been important for CFOs to step up and be heard. There have been tough decisions to make, requiring that all factors be meticulously considered. This is why liquidity and cash flow are such important focuses.

This 2020 P2Pv session provided attendees (regardless of financial expertise or experience) with insight to understand the impact of predictable monthly income and how to recognize that revenue properly.

In the segment above Dave Taccone of Spinitar talks about forecasting — specifically the impact that recurring revenue has had on forecasting. That’s a topic that moderator Brad Dempsey of Solutions360 knows well. He recently shared his seven keys for accurate forecasting in another P2P Series article. Here they are again:

Elements of Accurate Cash Flow Forecasting
Solutions360’s new Q360 dashboard utilizes seven elements to create accurate cash flow forecasts:

  1. Cash Receipts: The forecast allows you to use customer payment terms, average pay days, or expected payment dates if you’ve negotiated payment deferrals.
  2. Overdue A/R: For invoices over 90 days old, you can increase or decrease collection periods. This allows you to see the impact of not collecting overdue accounts or collecting them over longer periods of time.
  3. Payables: The forecast will use the default due date for vendor invoices or, if you have negotiated a deferred payment to a vendor, its expected pay date.
  4. Project Invoicing: When projects are created in Q360, invoicing tasks and their amounts can be prescribed for very accurate forecasting of billings.
  5. Project Material Planning: Within Q360 projects, the material list can be staged to indicate when equipment will be purchased. These costs are factored into the forecast within each period as planned.
  6. Service Contract Invoicing: Service and managed services contracts are preset in Q360, allowing the forecast to see when monthly, quarterly, and annual invoicing take place.
  7. Fixed Cost Analysis: Q360 allows you to play with fixed costs. Fixed costs are calculated based on historical periods. By default, the forecast looks back at the last three months of actual fixed costs and uses that data to project fixed costs. You can alter this to any number of months or set a percentage of fixed costs to forecast. Leaving the value at 100% will project the same fixed costs moving forward; change it to 110% to represent a 10% increase to fixed costs or set it to 80% if you are considering layoffs, for example.

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