Business financial planning is an essential element of a business plan. A well organized financial plan attracts potential business investors and gives your company economic focus. It allows you to assess the current financial situation while forecasting where you will be in the future. If the forecast is appealing, maintain current goals. If the company's future monetary situation looks daunting, however, make adjustments before it becomes a problem.

There are three elements of business financial plans:

1. An income statement

2. Cash flow projections

3. A balance sheet, which financial consultancy services can prepare for you

It is up to your company to decide if it makes more sense to draft the financial plan yourself or hire a financial services consulting firm to do it for you. While performing your own business finance planning is economically more feasible, it takes time and energy. Usually, smaller companies can get by organizing their own financial plans. Larger companies and corporations find it more beneficial to seek outside financial management consulting services.

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Utilize free business financial planning software

Small companies who wish to do their own financial consulting should take advantage of online software. While you can usually purchase similar software at the store, it is quicker and easier to download directly from the Internet. Many times you can find free software or free trials for your business needs.

I recommend: PlanWare by Invest-Tech Limited has free financial projection, cash flow forecast and business plan software. They have easy-to-use templates that save time and energy. Microfin, another free business financial planning software program, allows you to develop finance strategies and analyze financial projections.

Explore low price business financial planning software

While there are free financial planning software sites online, sometimes you get more when you pay a bit of money. Some have low-cost downloads that have customized financial plans tailored to your line of business.

I recommend: Acoll Software's Omega Enterprise Manager provides software which can create sales summaries, cost summaries and profit margin sheets. PlanMagic Corporation, another software source, offers financial planning software tailored to various types of businesses from construction to coffee houses.

Hire a professional financial consulting company

Large companies and corporations should seriously consider hiring an outside consulting firm to handle financial planning. There is simply a larger volume of information and data necessary to run a sizeable company. Rather than sort through your own financial information, you may find it a better investment to hire a professional.

I recommend: Ameriprise Financial, Inc. prepares your business financial plan and assists your employees with personal financial goals. Wachovia Corporation, another highly esteemed financial management consulting firm, also provides business and personal financial needs.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  Corporate financial experts agree that if your business credit score is lower than 70, adjust your business financial plan to take your score above 75.

Business financial plans are a tool that is beneficial to most businesses. It isn't enough to simply know how much money you make and how much your basic bills are. You also have to consider things like variable salary expenses, annual expenses and non-recurring expenses.

Knowing the business financial planning basics enables you to make informed decisions about your company's finances. Consider the following suggestions to help you build your financial plan:

1. Learn the fundamentals of business financial planning.

2. Read about the common mistakes people make when preparing business financial plans so you can avoid making these mistakes.

3. Buy a financial planning software program that is easy to use and meets all your needs.

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Know the business financial plan fundamentals

Business financial planning involves more than simply opening a bank account and buying and selling goods or services. You have create a business budget, determine the most appropriate way to spend and invest the business funds, figure out actual business expenses and determine your potential profits.

I recommend: You can find an in-depth series on small business financial planning on Bankrate.com. This website offers a wealth of information, including investment planning, debt management and tax information. Inc.com offers information about business financial planning for all types of businesses, including employee-owned and new businesses.

Avoid common business finance planning mistakes

It is possible to sabotage your own efforts to create a business financial plan by making certain mistakes. Second guessing yourself, overestimating income and underestimating costs are some of the most common mistakes when writing business financial plans.

I recommend: AccessMyLibrary offers information about some of the most common mistakes that happen when planning for your company's future. MoreBusiness.com offers good advice about how to avoid common mistakes when writing a business plan, including a financial plan.

Invest in business financial planning software

Using a business financial planning software program can save you a considerable amount of time and money. Many programs are all-inclusive and will prompt you to enter all the information needed to create an accurate business financial plan. Some software is stand-alone software, meaning you can use it on your own. Other software is part of a comprehensive financial consulting system that includes the help of a CPA or financial management consulting company.

I recommend: Moss Adams offers business financial planning software. This company also offers business financial services consulting via email, telephone or in person. NetSuite.com offers numerous business financial planning programs to fit almost any company's needs. The programs include amortization schedules, budget management and allocations journals.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  Consider using a business financial consulting company when you first start your business if you are unsure of how to compile a comprehensive plan on your own.

Business financial consulting services are in high demand whether the economy is up or down. Companies both large and small rely on these services to ensure that they're making the most of their investments and managing their assets correctly. A business financial planner helps these companies make the best decisions possible.

Having the right business financial planning education and training will allow you to work for a company in the field or start your own financial management consulting firm. Make sure that you get the best education you can afford; you'll be entrusted with the assets of different companies and your advice can make or break them. Consider the following:

1. Obtain a four-year degree. It's best to get a degree with a concentration in finance, or at least general business. You'll learn the basics of a business financial plan in your coursework.

2. Take your Certified Financial Planner exam. The CFA exam will allow you to practice with a financial consultancy firm.

3. Earn continuing education units in financial services consulting. Although you can take any qualified CEUs, if you want to focus on business financial planning, taking courses focused on that aspect is best.

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Learn from corporate financial experts while earning your undergraduate degree

A Bachelor's degree is not a requirement to take your CFP exam, but it is a requirement to get your actual certification. While any four-year degree will suffice, the best plan of action is to earn your Bachelor's degree in an area of finance. There are a variety of financial degree programs available all over the country and online. Some of these programs are tailored to business to business services although most focus on planning for individuals and businesses.

I recommend: Find an online business or finance program that suits you using College.com. You can find some good information about finance programs at Education-Portal.com. You can also search for both live and online programs.

Become a certified business financial planner

Preparing for the financial planning certification exam can be a daunting task. But if you want to work for a financial consulting company, you're going to have to get through it. Taking a special course designed to prepare you for the exam is a great way to make sure you're ready.

I recommend: Check out the certification programs available at Kaplan Schweser. Find a review course in your area using the Certified Financial Planner Board of Standards.

Maintain your business finance planning career with continuing education

To keep your certification, you must take continuing education courses each biennium. There is a multitude of business-related CEUs that are approved for use toward maintaining your certification. Examples include evaluation of risk, contracts, economics and financial statements. These will all give you the knowledge you need to advise your clients.

I recommend: Check out the home study programs at Financial Campus. The Financial Planning Association archives all of its seminars and makes them available online for those who can't attend live courses.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  In addition to taking continuing education units, you can also opt to take non-credit business financial planning seminars. These will help you learn new concepts as well as help you build your practice or clientele.

Business financial planning is a vital activity aspect of building and maintaining a successful company. A comprehensive business plan can help you attract investors as well as concentrate on key processes which will insure your business is profitable. Software packages can assist you with this process if you want ongoing assistance, as can financial consultants. As you explore this topic, you will run into some key terms that you will need to understand.

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Income statement

An income statement is also sometimes referred to as a profit-and-loss statement; it is a company's financial statement about how much revenue a company has made before expenses are taken out. It is also sometimes known as the 'top line.' Business financial planning consultants can assist organizations with developing an income statement.

I recommend: Entrepreneur Media explains this term for you.

Cash flow forecasting

Cash flow forecasting consists of the modeling of a company's future financial liquidity (assets that can be quickly converted to cash) over a particular time frame.

I recommend: See HJ Ventures International for a discussion on this topic.

Balance sheet

A company's balance sheet is a summary of assets, liabilities and ownership for a certain date, usually at the end of a fiscal year. It is a snapshot of the company's financial condition. Business financial planning consultants can offer services in developing a balance sheet.

I recommend: BusinessTown.com gives a definition of this term.

Sales projection or forecast

A sales projection or forecast is a plan or prediction of what level of sales can be achieved. It is usually based on historical data, an analysis of market trends, and estimates on what is achievable by sales management. Business financial planning consultants can assist an organization in developing a sales forecast.

I recommend: PlanMagic discusses this topic.

Liquidity

Liquidity is a measure of a business' ability to pay its debts when the debts are due.

I recommend: InvestorWords.com has a brief definition.

CAGR, compound annual growth rate

CAGR or compound annual growth rate is an investing term that represents the annualized gain which is earned by an investment in a given time horizon. It is often used to compare the growth of two investments. In financial planning, business financial planning consultants can help a business measure a firm's CAGR.

I recommend: Go to Moneychimp for more information.