The bank limit is always fully used

At the bank statement, supplier ledger and payment calendar, the accountant with the owner can usually see the earliest warning. The CC or OD limit runs at the maximum and leaves no room for a bad month. Check it before staff spend time correcting work that has already moved on.

What it looks like

• The accountant with the owner has to search the bank statement, supplier ledger and payment calendar before answering a routine question.
• The CC or OD limit runs at the maximum and leaves no room for a bad month.
• Staff cannot locate cleared bank transactions, approved bills and due dates for the latest case.
• People spot the gap after a routine payment crowds out wages, statutory obligations or essential supply.
• The open case has no documented owner, due date or proof of closure.

Why it happens

The specific failure is left unchecked. The CC or OD limit runs at the maximum and leaves no room for a bad month. If there is no recorded owner for that condition, the effect travels to the next team.

The work and its evidence move separately. Payment decisions may be made from today’s bank balance without the next set of committed outflows.

A later hand-off exposes the gap. A supplier invoice, approval and due date can remain in different records until an urgent payment request arrives.

The less obvious cause: A control may exist on paper but still fail in practice. Test whether someone actually performs this check: compare interest charges with customer collections and stock ageing.

Find the first failed hand-off before changing staff targets. A completed register alone cannot prove that physical work happened.

What to check first

1. Read daily CC or OD utilisation for the last month. Compare dates, quantities and references. Mark an unconfirmed difference as unverified. Finish the first pass in under 30 minutes and name the missing source if needed.
2. Compare interest charges with customer collections and stock ageing. Record the affected item or party and the person who can verify the detail. Finish the first pass in under 30 minutes and name the missing source if needed.
3. Check whether temporary funding supports permanent slow-moving stock. Mark each exception open, waiting for evidence or resolved, with a named next owner. Finish the first pass in under 30 minutes and name the missing source if needed.

How to fix it

1. Start with one live case. Read daily CC or OD utilisation for the last month. Keep the source reference before changing the record.
2. Make the control explicit. Track facility headroom and forecast cash over the next four weeks. Put the rule in the register or sheet that staff already use.
3. Set a second guardrail. Discuss renewal or restructuring with the bank before a crisis. Keep an actual bank balance separate from likely receipts. Check tax and legal priorities with a qualified adviser.
4. Assign the next decision. The accountant with the owner records the action and its due date. A separately authorised person signs off changes affecting money, safety or customer terms.
5. Review the open list. Start with items affecting today or tomorrow. Keep third-party commitments separate from completed actions.
6. Check whether the rule holds. For four weeks, count committed outflows unsupported by confirmed available cash. Reopen repeat cases and identify where the control failed.

Copy this cash and supplier payment priority sheet into a register or sheet:

Retain the source reference and limit access to authorised staff.

A worked example

Illustrative example only. An illustrative ₹25 lakh limit stays above ₹24.5 lakh every day. Start by locating the source that would verify these amounts or quantities. The accountant with the owner records the exact exception, gives it an owner and checks the next relevant event. This example shows how to structure the decision. It does not claim that a business achieved a saving or avoided a loss.

How you know it is fixed

• Completeness: Count committed outflows unsupported by confirmed available cash at the same time every week. Record the count and the oldest item, rather than just saying things are better.
• Timeliness: Check whether the assigned person took the next action before the agreed cut-off. Keep missed dates visible instead of replacing them silently.
• Proof of closure: Sample three closed cases and locate cleared bank transactions, approved bills and due dates. A tick without supporting evidence is still an open control gap.

When it is more serious

Breach of facility terms or inability to pay interest needs bank advice. Hold irreversible decisions until the material facts are verified. For contracts, tax, wages or legal rights, retain source documents and consult a qualified adviser. Repeated exceptions after four reviews may require changing the control.

This works if someone does it every day. In most businesses, that someone is you.

Questions people ask

What should we check before taking action?

Read daily CC or OD utilisation for the last month. Keep its date and reference. Then compare it with cleared bank transactions, approved bills and due dates; if they disagree, record the difference before changing either one.

Who should own the next action?

The accountant with the owner should own the open item. The person authorised to change money, a technical standard or a customer commitment must still approve that decision.

Can we run this control without new software?

No. Start with a shared sheet or register containing the reference, owner, promised date, status and evidence. Once those fields are reliable, decide whether a system connection is worth setting up.

When is the issue serious enough to escalate?

Breach of facility terms or inability to pay interest needs bank advice. Keep supporting records and get specialist help where relevant.