2. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Class : Y11 Lesson Topic: Finance Scheme of Work: Cash flow

3. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow.

4. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Lesson Objectives ALL (KNOWLEDGE) Define and describe a cash flow statement MOST (ANALYSIS) Examine and Analyse the sections of a cash flow statement SOME (EVALUATION ) Evaluate the pros and cons & Justify your views on the usefulness of a cash flow statement. P&D Planning and Planning and Data Higher thinking Skills

5. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Planning Tools P&D Planning and Planning and Data

6. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. KeywordDefinition Cash flow Cash flow forecast Inflow Outflow Liquids Net cash flow CONNECTIVES

7. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. CONNECTIVES for Analysis CONNECTIVES for Application CONNECTIVES for Evaluation COMPARING Equally… As with… Like… In the same way… Similarly… Even so… Likewise… CAUSE & EFFECT Consequently…Due to… As a result…Therefore.. Because of…Because… CONCLUDING Firstly…After… Secondly…Before… Overall…I believe… Finally…I think … In conclusion…it depends… To conclude…short term… Meanwhile…Long term… CONTRASTING Although…Except… Moreover…If… However…Yet… Apart from…Unless… Despite…As long as… EMPHASISING Most importantly… Significantly… Notably… Especially… Above all… In particular… Indeed… QUALIFYING Despite…Yet… As long as…Unless… Apart from…If… Moreover…Except… However…Although… ADDING In addition…And… Too…Also… Additionally…As well as… Furthermore… ILLUSTRATING For instance…Such as… In the case of…So… For example… As revealed by… As illustrated by…

8. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Climb the Ladder A-A* 1.To what extent 2.Do you think 3.Evaluate whether (8-10m) 10+ connectives & key words C-B 1.Explain 2.Compare 3.Analyse (5-8m) 5+ connectives & key words E-D 1.Define 2.Describe 3.Identify (2-4m) 2 + connectives & key words ATD Apply to Apply to demonstrate

9. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Cash flow Cash is a liquid asset. Most accessible and transferable asset (compared to a building?). Like blood in your body. Many start up businesses fail because of lack of CASH, not profit. Businesses must manage their cash flow to ensure that they have cash available when it is required. This involves: Estimating inflows & outflows of cash

10. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Cash flow management REDUCE OUTFLOWS, INCREASE INFLOWS. Reducing the amount owed by creditors – cash sales, repayment incentives, factoring Negotiating payments ON DEBTS. Leasing and renting instead of buying.

11. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Negative cash flow This is when on a particular month you spend more than you receive. Not a problem if this happens just a couple of times. Might mean you need to arrange an overdraft or stop buying things. Can be a problem if it is every month as it means you have NO money.

12. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Cash flow DOES NOT show profit If you end up with a positive figure at the end of the month this does not mean you have made a profit. It just looks at the flow of money on a monthly basis. Can a profitable business have negative cash flow?

13. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Can a profitable business have negative cash flow? Yes, This may be due to:  Slow payment by creditors (trade credit)  Delay between the purchase of materials and payment from customer – e.g. construction  Large capital purchases must be paid for in cash but are recorded on the profit and loss account over several years

14. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Some useful equations Cash inflow greater than cash outflow = (+ )cash flow Cash inflow less than cash outflow = ___ cash flow Cash inflow – cash outflow = Net cash flow

15. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. For April 2015 – Calculate – Inflow, – Outflow, – Net cash flow Extension calculate for May.

16. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Opening & Closing Balance Opening balance is the money a business has at the start of each month. Closing balance is the money at the end of each month (opening balance + net cash flow) New opening balance is same as old closing balance.

17. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Calculate; Feb closing balance March opening balance April closing balance.

18. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow.

19. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Forecasting HOW? Look at past data Research other businesses Look at secondary data on spending habits WHY? You need to estimate your income – all the money flowing in You need to estimate your expenditure – all of the money flowing out CASH ENSURES SURVIVAL!

20. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. KeywordDefinition Cash flow Cash flow forecast Inflow Outflow Liquids Net cash flow CONNECTIVES

21. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Lesson Objectives ALL (KNOWLEDGE) Define and describe a cash flow statement MOST (ANALYSIS) Examine and Analyse the sections of a cash flow statement SOME (EVALUATION ) Evaluate the pros and cons & Justify your views on the usefulness of a cash flow statement. P&D Planning and Planning and Data Higher thinking Skills

22. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Pass the Parcel Add as much information you can remember from today’s lesson When the horn blows – pass your sheet to the next table! R Review the Learning Review the Learning

23. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Neighbours 2 things your neighbour has learnt today 1 question your neighbour wants to ask R Review the Learning Review the Learning

24. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. Summarise your learning today into a single tweet 140 characters Keep all of the information Tweet STOP R Review the Learning Review the Learning

25. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. 1 question you need to ask 2 new things you learnt 3 pieces of information R Review the Learning Review the Learning

26. Business Section: FinanceFurther Reading C.29 Keywords – cash flow, forecast, inflows, outflows, liquid, net cash flow. 5 minutes... GO STOP