Why does my business show profit but still face 'cash shortages'?

Profit is recorded when sales are made, not when money is received. If customers pay late or expenses are paid upfront, cash can run short. The cash flow statement shows the actual movement of money and explains this gap.

How often should I review my balance sheet and cash flow statement?

You should review them at least quarterly. For growing D2C companies and consumer brands earning $5M+ in revenue, monthly reviews are better. Regular checks help spot rising debt, falling cash, and weak asset positions.

What balance sheet items do banks focus on before approving loans?

Banks mainly review cash balance, outstanding loans, total liabilities, and owners’ equity. They want to ensure the business has enough assets to repay debt and that the owner has invested sufficient capital.

Which cash flow section matters most for business survival?

Cash from operating activities matters most. It shows whether daily operations generate enough cash to cover expenses. Positive operating cash flow indicates the business can run without heavy reliance on loans or owner funding.

Maximilian Straub, Author at Atidiv

About the Author

Maximilian Straub is the Chief Operating Officer at Guild Capital, where he leads strategic operations and drives portfolio-level performance across global markets. He also serves as a Board Member at Atidiv, a leading outsourcing solutions company based in Pune, India, where he supports growth and operational scale initiatives.

Prior to this, Maximilian was the COO & CFO at Spring Place in New York, overseeing business transformation and financial operations. His earlier career was shaped by a 7-year tenure at McKinsey & Company in Zurich, where he rose through the ranks from Senior Associate to Associate Partner. During his time at McKinsey, he advised global clients on strategy, operations, and organizational transformation across various industries.

With deep expertise in operational excellence, finance, and strategic scaling, Maximilian combines consulting rigor with executional depth to build and grow high-performing businesses.