Cash flow tracker

What is cash flow tracker?

Cash flow tracker is a financial tool that helps businesses track the inflow and outflow of money, expenditures, and revenue in a business. It can be a spreadsheet, a financial tracking tool, or a dashboard that shows the spending and income over time.

The cash flow tracker has two components.

1 - Cash inflow - Sales revenue, customer payments, loans, investments. 2 - Cash outflow - Lease and rent, wages, supplier payments, loan repayments, utilities. 3 - In short, the cash flow tracker shows how much you have on hand to manage immediate expenses.

Why is cash flow tracking important for a business?

Every business tracks its finances, which include its expenses and income. But are they aware of the cash flow at any moment, and if yes, are they aware of the trends and minute changes in it? Not all as they don’t have the set up for it or have tools with limited functionalities. Here's why cash flow tracking must be a part of the finance and accounts keeping.

No expensive surprises: Many small businesses fail not because of losses, but because they run out of cash unexpectedly. A tracker shows upcoming shortfalls before they become crises.

Can make smart, data-driven decisions: When there is clear visibility, the business can make safe moves, knowing when it’s safe to hire, invest in new stock, or expand.

Ingests confidence in leadership and management: Whether its lenders, investors, or upper management, cash flow is equally important as that of profits and returns. Showing steady cash tracking builds trust and unlocks funding.

More awareness and resilience: The papers and accounts may show profits; but that doesn’t mean there is money to spend on everything. Cash flow tracking must be there in place, so a business can pay rent, utilities, and employees on time. Not just this, cash flow awareness builds resilience, even in testing times.

How to set up cash flow tracking?

A quick guide in setting up your automated cash flow tracking tool with limited resources.

1 - Start with selecting a tool: You can go for Excel or spreadsheets if you are dealing with low to mid-level data volumes. There are also tools like QuickBooks, Xero, etc. Or, if you want custom automation set up with visualized charts, then Power BI or Tableau.

2 - Record cash flow data: Connect relevant accounting and finance data sources record cash inflows and outflows. Many businesses define the time frame as monthly for tracking, but you can also set up weekly or daily cash flow tracking too.

3 - Net cash flow monitoring: The net cash flow is total inflow – total outflow. If the cash flow value is positive, it means you have surplus cash resources. If it’s negative, there is a shortage risk.

Track regularly: With BI tools like Power BI, it is possible to trace cash flow changes and trends regularly and receive automated alerts when there is a critical change.

Important cash flow KPIs to track

Yes, there is net cash flow. But there are other components too, tracking which can give you more clarity.

1 - Opening Balance - Cash at the start of the period.

2 - Total Cash Inflows - Total money received.

3 - Total Cash Outflows - Total money spent.

4 - Net Cash Flow - Inflows – Outflows.

5 - Closing Balance - Cash left at the end.

6 - Cash Flow from Operations - Day-to-day business (sales – operating costs).

7 - Cash Flow from Financing - Loans, investments, repayments.

8 - Cash Flow from Investing - Big purchases like equipment/software.

9 - Burn Rate - How fast you’re spending cash per month.

10 - Runway - How many months you can survive with current cash.

With AI-powered custom automation, you can start tracking these descriptive and predictive metrics related to your spending and inflow.

Manual vs automated cash flow tracking

There are many ways to track cash flow: manually, with spreadsheets, or through automated tools. Here's how manual and automated tracking differs.

What is preferable – manual or automated cash flow tracking?

This depends on your cash flow limits, workflows, and number of financial systems involved. While manual cash flow tracking is good for getting started, it is limited and risky as the business grows. On the other hand, automated tracking ensures real-time visibility, forecasting, and confidence—essential for scaling.

Choosing the right cash flow tracking system

It starts with understanding your business and its requirements. If you are a small business/solopreneur, then a simple Excel or Google Sheet may be enough for cash flow tracking. If you are a growing business dealing with a steady volume of inflow and outflow, then go for automated trackers.

Look for the following features and capabilities while selecting cash flow tracking tools:

1 - Can the tool integrate data from bank, POS, invoicing, and payroll systems? 2 - Will there be real-time visibility and updates? 3 - Will there be forecasting insights, and not just the summary of ‘where the finances are right now’? 4 - User-friendliness, budgeting, and other things.

In short, here’s how you know the right cash flow tracking for your business.

1 - You are starting small -> spreadsheets. 2 - You want to grow smarter -> automated tools. 3 - You want to grow, bcale confidently with advanced analytics + AI forecasting.