Archive for September, 2009
Nortel 5520-48T-PWR Ethernet Routing Switch with PoE - 4 x SFP (mini-GBIC) Shared - 48 x 10/100/1000Base-T LAN, 2 x
Nortel 5520-48T-PWR Ethernet Routing Switch with PoE - 4 x SFP (mini-GBIC) Shared - 48 x 10/100/1000Base-T LAN, 2 x
What are the main reason for negative cash flow in a construction company?
I am working in the company of my dad - a small construction company for bathrooms. I noticed a problem with the financials. The company posts a positive profit but has negative (almost zero) cash flow.
From the view of a construction company, what could be the main reason for the negative cash flow? Where should I start looking to see where the money flows?
Any ideas?
First, look at salaries of executives in the company. The owner may be paying the whole profit to him/herself as s salary, which lowers the tax liability of the company overall. This is smart as far as taxes go, but the should build up about 6-months worth of operating expenses in retained earnings. (emergency fund)
