3 articles
Profitable on paper but short on cash? This guide explains free cash flow versus accounting profit, then walks through a full worked example with a fictional joinery business to show exactly where the money disappears to.
A profitable month on paper and an empty-feeling bank account are not a contradiction — they are two different accounting lenses on the same business. This article unpacks the gap between accrual and cash basis accounting with a worked example, journal entries, and a step-by-step reconciliation so you can stop confusing timing differences with real trouble.
Profitable on paper but perpetually short on cash? The cash conversion cycle reveals exactly how many days your money is trapped in stock, unpaid invoices and supplier terms – and shows precisely where to act. Using a worked example from a bespoke furniture maker, this guide walks through calculating DIO, DSO and DPO, and turning those figures into real, freed-up cash.
