Did you know that the average CEO reads a book a week? That’s 52 books a year. If you want to know more about cash flow, put some or all of these titles on your reading list.
The following books focus on the basics of cash flow monitoring, as well as some of the more esoteric concepts behind your company’s day-to-day finances. Our list of the best cash flow books runs the gamut — from barebones introductions all the way up to tips on tackling your company’s more confounding financial data.
But, even the best cash flow books can only go so far. In addition to your learnings, you’ll still need to apply your newly acquired acumen in the real world. Smansha’s cash flow forecasting tool helps you turn your financial data into meaningful cash flow metrics. (Another fact: SMEs who monitor cash flow on a monthly basis have an 80% survival rate.)
What’s covered in the best cash flow books
Let’s review a few cash flow basics before you load up your cart (virtual or real-life, depending on your preference). In short, cash flow is the sums of money that flow in and out of your business. Cash flow is a key indicator of an enterprise’s financial health. It also demonstrates, in real terms, whether or not your business is financially stable, able to pay its bills and can keep daily operations humming without major disruptions.
You’ll want your company to stay cash flow positive, with only a few exceptions. You’re cash flow positive if you have enough money to pay for your financial obligations without running out of money. If your business can’t pay off its debts, it is considered to be cash flow negative.
One of the only times you can expect to be cash flow negative (and not be in a potentially risky situation) is if you’re in the middle of a launch or an investment phase. This is usually the case for early-stage companies or those that are pre-revenue. (You would normally be prepared for a down period in either scenario.)
The best cash flow books for novices
Every entrepreneur has to begin somewhere. Just because you’re not a financial whiz doesn’t mean that you can’t become one — or, the very least, learn enough about cash flow to keep your business humming. There’s a slew of books that are ideal for small business owners who are just learning the ropes of accounting and finance. These introductory cash flow books will give you a solid foundation by teaching you the basics.
Cash Flow for Dummies offers exactly what you might expect from the title — a straightforward primer on the basics of cash flow. This book dives into the ins and outs of maximizing your company’s cash flow, cash management, and how these elements of your business affect its overall earnings. The authors spell out how to read cash flow statements as well as the best ways to analyze and monitor cash balances. It also covers other essential aspects of managing cash flow, including control methods for cash receipts, disbursements, and bank account reconciliation. And to round things out, the authors also show readers how to prevent fraud and waste, which can drain cash flow unexpectedly.
We recommend Cash Flow for Dummies for any newcomer to basic cash flow principles. This book not only teaches you the core components of any SME’s cash flow setup, but it also dives into the strategies and tactics that will help you make the most of your cash flow while avoiding potential pitfalls along the way.
Plewa and Friedlob’s Understanding Cash Flow offers a succinct, approachable overview of how cash flow works, and what it means for your business. Although it’s a bit older than some of the other titles in this list, it’s one of the most meaningful books for cash flow novices.
This is due in part to the authors working under the assumption that you’ve likely heard the term “cash flow” in the past, but are probably unsure of what it truly means (and might even be too scared to look). Understanding Cash Flow provides a detailed overview of how cash flow management affects company earnings. It also discusses how to analyze cash balances and cash flow statements and how to prevent fraud.
This book covers the basics of cash flow for any nascent small business owner who wants to take control of this element of his or her business. The authors discuss topics in detail without getting overly technical, which makes the complex subject matter a little easier to swallow.
Fotopulos’ Accounting for the Numberphobic builds on the core concepts explained in Cash Flow for Dummies, providing an easy-to-read primer on everything you need to know about your company’s finances. This book provides explains why it’s important to take ownership of your company’s accounting and finance practices, as well as how. Each chapter provides real-world expertise on topics like net income statements, measuring and increasing cash flow, and how to identify the break-even point — which is when your business becomes self-sustaining.
Accounting for the Numberphobic is a great read for any business owner who loves building their business, but hates looking at numbers. The book breaks down the intimidating factors of financial management and helps you understand why and how your numbers require steadfast attention.
The premise behind Small Business Cash Flow is that most entrepreneurs know that cash flow is an important part of their business’ financials, but may not know what it means or how it works. O’Berry covers the basics of cash flow management down to the very basics of choosing the right accountant, all the way up to budgeting and record-keeping. The book provides a great primer on small business financing, as well as the top-level issues concerning cash flow management.
This book is for you if you’ve ever had a question about your company’s finances that you were too afraid to ask. There’s no issue too big or too small within Small Business Cash Flow, as even the basic purpose of money within your business is given its own chapter. This resource is perfect for the budding entrepreneur — or even the financially inexperienced veteran.
Cash flow books that go beyond the basics
There are tons of great books out there for entrepreneurs who know about cash flow basics but may want to dig a little deeper into the best ways to manage their company’s financial future. Or, alternatively, fix existing cash flow problems that might plague their business.
Whether you’re sleuthing out a cash flow issue, or simply want to extend your financial know-how, here are a few books that can help. These titles will help you build on what you know through tangible facts, solutions, and tactics to increase cash flow.
Cash Flow Problem Solver is designed to help business owners determine where their company’s cash flow issues stem from, and how they can solve these problems before it’s too late. This book focuses on the basic principles behind positive cash flow management, which incorporate a proactive approach to cash flow principles and a vigilant focus on keeping a company’s operations cash flow positive at all times. Milling offers valuable insights that business owners can refer to on a daily basis, or when cash flow issues arise.
This title offers more than a detailed examination of what cash flow means, and why it’s important for your business. Cash Flow Problem Solver goes tackles common cash flow issues directly, providing tangible insights into the most routine issues that might impact your company’s bottom line.
One of the most popular sayings about cash flow is “Cash is king.” Cash is Still King makes a compelling argument as to why. The author compiles nearly 10 years of cash flow training experience with leading business firms and provides his firsthand experience with the common cash-related issues that companies tackle. Checkley’s book is rife with case studies in how companies managed to turn around their cash flow issues, and why their methods succeeded.
Cash is Still King offers readers with real-world examples of when and how companies end up with cash flow crises. Better still, the book provides realistic solutions that SMEs can use to create their own rebound stories.
Finance for Nonfinancial Managers covers the basics of financial reports, cost accounting, as well as operational planning and budgeting through plain-spoken language for those of us who aren’t inherent financial mavens.
Siciliano provides the info you need to better understand balance sheets, cash flow statements, and income statements without getting overly complex. Additionally, this book covers the basics of cost accounting, which can help you determine which products and services help provide your company with the most money. This title also helps you draft operational plans and budgets, synthesizing the financial tools you’ve learned in order to help you make more informed business decisions.
Finance for Nonfinancial Managers empowers you with the essentials of business financials, without getting mired in complex topics and complicated language. You’ll learn how to keep tabs on your company’s money and financial health, even if that only means that conversations with your accountant become easier.
The best cash flow books for financial gurus
Entrepreneurial Finance: Finance and Business Strategies for the Serious Entrepreneur by Steven Rogers and Roza E. Makonnen
If you’ve covered cash flow and triumphed over balance sheets, you might be ready to take on even bigger-picture topics and strategies. Entrepreneurial Finance offers tangible advice from top-tier business minds that can help you scale your business.
It provides effective methods for keeping solid fiscal control over expenses, along with tips on how to avoid the financial pitfalls. It also goes into valuing your company, raising debt and equity capital, and the best strategies for financing your growth.
Creative Cash Flow Reporting: Uncovering Sustainable Financial Performance by Charles W. Mulford and Eugene E. Comiskey
Creative Cash Flow Reporting isn’t a euphemism for fiddling with the books (which we would always advise against strongly). Rather, this book is about sniffing out the tricks and techniques commonly used to fudge financial numbers, or innocent errors that might result in you underreporting how much cash your company has in its coffers. Comiskey outlines methods for detecting cash flow issues — whether real or doctored — as well as methods for adjusting cash flow statements to yield better analysis of how your company earns and spends.
This book is a must-read for any entrepreneur with an advanced cash flow knowledge and a good handle on their business’ basic finances. Creative Cash Flow Reporting can help you take additional steps toward improving your financial records, and even help you better understand your company’s operating finances.
Understanding Balance Sheets is the second book by Friedlob and Plewa on our list. This title builds on Understanding Cash Flow by drilling deeper into the basics of balance sheets and why they’re vital for understanding your company’s financial health. The authors dive into the major aspects of balance sheets and help business owners develop their own balance sheets. Better still, they provide an understanding of how constituent parts of a balance sheet — receivables, cash, inventory, long-lived assets, long-term debt, and equity — impact your company’s financial forecast.
If you’re interested in taking your financial knowledge to a new level, Understanding Balance Sheets is a great place to start. This book deepens your knowledge of company finances beyond cash flow, empowering smarter financial decisions down the road.
The plot thickens…
To really master your company’s financials, you’ll need to create a cash flow forecast using Smansha’s insights and analysis.
Another key metric included in this forecast dashboard is a proprietary risk score that shows you how your business is seen in the eyes of prospective lenders and business partners.
Signup is a breeze — simply create a Smansha account, connect your QuickBooks Online account, select your business and run your report.
The information in this article is not financial advice and does not replace the expertise that comes from working with an accountant, bookkeeper or financial professional.
Stock photo via Pixels. Cash flow book thumbnails via Amazon.