Cash flow management is the major issue facing small business, according to a newly released survey.

Ensuring adequate cash flow from operations was the No. 1 issue cited by small businesses in a survey conducted by CPA2Biz, the marketing and technology services subsidiary of the American Institute of CPAs. CPA2Biz conducted the survey of 500 small businesses with less than 15 employees and $2 million in annual revenues. It plans to announce the complete results at an upcoming conference in Providence.

"I wasn't surprised to see cash flow management at the top of the list," said Bill Reeb, a CPA and chair of the Small Business Conference Program. "But I was surprised by how few small business owners are leveraging tools to get a better handle on it."

The survey also found that 51 percent of the respondents said they don't use budgets or forecasts to help manage their business, while 32 percent said they don't have specific metrics in place to monitor performance on a daily or weekly basis. Only 17 percent agreed that daily or weekly metrics are as important to them as their financial statements.

Only 21 percent of participants in the survey measure their return on investment of advertising and promotional dollars; and only 11 percent said they regularly monitor non-financial indicators, such as customer support calls and visits to the company Web site, to further evaluate business performance.


Register or login for access to this item and much more

All Accounting Today content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access