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I wanted to know what does it mean if there is a huge difference in the amount of the net profit and the cash flow forecast. For example i create a cash flow forecast and at the end of the year i am left with a closing balance of £5016 but when i create a profit and loss account i have a net profit of £15.90. What does this mean. That my business is not profitable in the long-term?
Sorry if i made mistakes as i was typing this very quick.
Thanks:)
Answer You don't say how long you are estimating over, but a small profit at the end of year 1 is quite normal.
There should not be a big difference between the cash flow and profit, but your figures are not unusual.
