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á P C - F l o w (Personal Cash Flow Budgeting System) User's Manual Version 1 September 6, 1988 Copyright (c) 1987,1988 Danlware Systems Corporation P.O. Box 6903, Station J Ottawa, Ontario K2A 3Z5 Canada NOTE: This is the manual distributed with PC-Flow. Registered users receive an expanded edition. General Information Included on the distribution disk is a file called README which can be viewed by the DOS command: TYPE README (press ENTER). This file contains information not included in this manual such as changes made for each program version. -=- Please note the following trademarks in this manual: IBM PC is a registered trademark of International Business Machines Corporation. MS-DOS and PC-DOS are trademarks of Microsoft Corporation. WARRANTY THIS PROGRAM IS PROVIDED "AS IS" WITHOUT WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHAN- TABILITY AND FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT WILL Danlware Systems Corp. BE LIABLE TO YOU FOR ANY DAMAGES (INCLUDING ANY LOST PROFITS, LOST SAVINGS OR OTHER INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF YOUR USE OR INABILITY TO USE THE PROGRAM) OR FOR ANY CLAIM BY ANY OTHER PARTY. PC-Flow was designed and developed by Daniel Comeau. The manuals were written by Sharon Allen and Daniel Comeau. ii Contents 1 Introduction To PC-Flow . . . . . . . . . . . . . . . . . . . . 1 1.1 What Is PC-Flow? . . . . . . . . . . . . . . . . . . . . 2 1.2 Computer Hardware And Software Requirements . . . . . . 2 1.3 Distributing And Paying For PC-Flow . . . . . . . . . . 2 1.4 Copying And Running PC-Flow . . . . . . . . . . . . . . 2 2 What Does PC-Flow Look Like? . . . . . . . . . . . . . . . . . 3 2.1 The Overall Picture . . . . . . . . . . . . . . . . . . 4 2.2 Getting Help From PC-Flow . . . . . . . . . . . . . . . 4 2.3 The Menus -- A Guided Walk Through PC-Flow . . . . . . . 4 2.4 The Starting Resources File -- PC-Flow's Starting Point 4 2.5 The Budget Transaction File -- PC-Flow's Ledger . . . . 4 2.6 Configuring PC-Flow To Your Equipment Or Taste . . . . . 5 3 A Scenario: Making PC-Flow Work For You . . . . . . . . . . . . 6 3.1 Sample Scenario . . . . . . . . . . . . . . . . . . . . 7 3.2 Analysis Of Scenario . . . . . . . . . . . . . . . . . . 7 3.3 Setting Up The Data Files . . . . . . . . . . . . . . . 7 3.3.1 Starting Resources . . . . . . . . . . . . . . . 7 3.3.2 Budget Transactions . . . . . . . . . . . . . . . 7 4 Maintaining The PC-Flow Files . . . . . . . . . . . . . . . . . 8 4.1 Modifying The Starting Resources . . . . . . . . . . . . 9 4.2 Adding And Changing The Budget Transactions . . . . . . 9 4.2.1 Known Versus Estimated Transactions . . . . . . . 9 4.2.2 Recurring Versus One Time Transactions . . . . . 9 4.2.3 Classifying The Transactions . . . . . . . . . . 9 5 Using PC-Flow As A Planning Tool . . . . . . . . . . . . . . . 10 5.1 Starting Resources . . . . . . . . . . . . . . . . . . . 11 5.2 Budget Transactions . . . . . . . . . . . . . . . . . . 11 6 PC-Flow Reports -- Their Features . . . . . . . . . . . . . . . 12 6.1 Starting Resources Report . . . . . . . . . . . . . . . 13 6.2 Transaction Reports . . . . . . . . . . . . . . . . . . 13 6.3 Cash Flow Report . . . . . . . . . . . . . . . . . . . . 13 6.4 Net Cash Flow Report . . . . . . . . . . . . . . . . . . 13 6.5 Classification Breakdown Report . . . . . . . . . . . . 14 6.6 Old Transactions Report . . . . . . . . . . . . . . . . 14 6.7 Determining A Date Range For The Analysis . . . . . . . 14 6.8 Using PC-Flow On A Regular Basis . . . . . . . . . . . . 14 7 What To Do If PC-Flow Misbehaves . . . . . . . . . . . . . . . 15 7.1 PC-Flow Execution Errors . . . . . . . . . . . . . . . . 16 7.2 Emergency Exit Out Of PC-Flow . . . . . . . . . . . . . 16 8 Tips And Techniques . . . . . . . . . . . . . . . . . . . . . . 17 8.1 Recurring Estimates -- Regular Credit Card Use . . . . . 18 8.2 Saving Money . . . . . . . . . . . . . . . . . . . . . . 18 8.3 Planning For A Big Expense . . . . . . . . . . . . . . . 18 8.4 Reducing The Memory Requirements Of The Data Files . . . 18 iii Contents 9 In The Future . . . . . . . . . . . . . . . . . . . . . . . . . 19 9.1 Features To Come . . . . . . . . . . . . . . . . . . . . 20 GLOSSARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 iv CHAPTER 1 Introduction To PC-Flow 1 PC-Flow 1 User Manual Introduction to PC-Flow 1.1 What Is PC-Flow? "But payday isn't for another two weeks!" R. Shaw. The Personal Cash Flow Budgeting System (PC-Flow) enables the forecast and analysis of budgetary data with an emphasis on daily cash flow. Each transaction entered into PC-Flow may occur once or recur daily, weekly, or monthly. PC-Flow transforms these transactions within a user defined time period so that the budget may be analyzed. This approach to budgeting lets the user quickly observe the cash flow situation as the transactions are scheduled to occur. The information can then be used for budget planning. 1.2 Computer Hardware And Software Requirements To run PC-Flow, you will need an IBM-PC or look alike with the DOS operating system version 2.1 or greater. PC-Flow requires 222KB of available RAM to run. Your computer's CONFIG.SYS file should have FILES set to at least 15. 1.3 Distributing And Paying For PC-Flow You are encouraged to copy PC-Flow and distribute it to others. To support and pay for the development of this product, please register if you find this program to be of use. When you register you will receive the latest version and a bound, printed manual describing the basic and advanced concepts of PC-Flow. An order form can be printed out via menu 5, option 2. As a registered user, you will be notified of all major program updates. 1.4 Copying And Running PC-Flow PC-Flow provides a command (on menu 4) to make a copy of itself. This is the easiest way to make a copy for someone else. All the files will be copied without any personal financial data. Otherwise, using DOS commands to copy, you will probably want to purge the data in the files. Purging the data can also be done via a menu command (menu 3.3). PC-Flow is executed in DOS using the command "pcflow". 2 CHAPTER 2 What Does PC-Flow Look Like? 3 PC-Flow 1 User Manual What Does PC-Flow Look Like? 2.1 The Overall Picture PC-Flow provides a series of display screen menus which permit the user to establish and modify the budgetary data to reflect the current situation. This information can be output in reports to provide both factual and analytical scrutiny. 2.2 Getting Help From PC-Flow At any time while using PC-Flow, the Help facility can be ac- tivated by pressing the <F1> function key. The Help facility provides context sensitive aid on all the menus. If in doubt about the use of a data field when entering expense or income data, Help will provide a description and relevant hints for this field. Upon exiting Help, the user is returned to the location from which Help was sought. 2.3 The Menus -- A Guided Walk Through PC-Flow Menu screens provide command options available for execution. Through the menus, the user is given a variety of options in maintain- ing and analyzing his budgetary situation. The first menu presented is the Master Menu. From it, all the other menus and commands of PC-Flow are available. 2.4 The Starting Resources File -- PC-Flow's Starting Point The Starting Resources File is a vital concept of PC-Flow. Incoming transactions, such as paycheck, are NOT recorded in this file. The role of the Starting Resources is to establish a starting date for the analysis and indicate any "cash on hand" that will be used to meet financial commitments from this date forward. Entries may be left blank, or may include balances of bank accounts or cash in your wallet or purse. In either case, the starting date must be entered, as this will be the "anchor" for budgetary analysis. 2.5 The Budget Transaction File -- PC-Flow's Ledger The Budget Transaction file acts as a ledger to record recurring financial activities. Entries might include "active" items such as paycheck, mortgage, food, clothing, and car insurance. These transac- tions record both incoming and outgoing activity. They can be set to recur over different time frames. Within each time frame, a frequency of occurrence can also be indicated. 4 PC-Flow 1 User Manual What Does PC-Flow Look Like? 2.6 Configuring PC-Flow To Your Equipment Or Taste Various system parameters may be set to change the display of screens and output reports. If the default setups are not adequate, the configuration facility enables PC-Flow to accommodate: your printer setup, your choice of date formats, and your choice of colors for a color monitor. The <F10> key may be used from most menus to change the output destination for the reports. 5 CHAPTER 3 A Scenario: Making PC-Flow Work For You 6 PC-Flow 1 User Manual A Scenario: Making PC-Flow Work For You 3.1 Sample Scenario To illustrate the capabilites of PC-Flow, let's consider a sample scenario. Mr. Ric Shaw gets a regular paycheck and pays various expenses weekly and monthly. In addition, he is paying off last year's vacation on his credit card and would like to put some money aside for a holiday next year. Ric's situation will be used as a sample of how to set up and use PC-Flow as an aid to budgetary analysis. 3.2 Analysis Of Scenario Ric's first step in setting up PC-Flow is to take a look at the known aspects of his situation. This is done before any information is actually entered. He looks at what he has as resources; ie., bank accounts and cash on hand. Then he decides if he wants these amounts included in his analysis. Next, he looks at the regular flow of income and expenses over a month: paycheck, mortgage, etc. Finally, he considers what irregular expenses he will have. These include such items as his car repairs and vacation next year. 3.3 Setting Up The Data Files 3.3.1 Starting Resources Having analyzed his budget items, Ric can begin to set up his files. He begins with his Starting Resources. He enters the current date as the starting date of the analysis. Ric feels that he may have to rely on his resources to meet his expenses, so he chooses not to leave these items blank. He identifies one resource as "Savings Account" and another as "Checking Account." For each account he records the appropriate balance. Then he enters the cash in his wallet as another item. Because the bank penalizes Ric if his checking account falls below a certain balance, he indicates this amount as the minimum balance for that Starting Resource item. 3.3.2 Budget Transactions Next, Ric enters his "active" or "coming and going" items into the Budget Transaction file. He has two basic types of financial transac- tions. Some recur on a regular basis: paycheck (every two weeks), mortgage (first of each month), groceries (every second Saturday), spending money (every Friday), and credit card payments (22nd of each month). Each of these transactions is entered indicating its unique period, starting date, and optional ending date. Other items such as his vacation next year, are one time expenses and are entered as such. 7 CHAPTER 4 Maintaining The PC-Flow Files 8 PC-Flow 1 User Manual Maintaining The PC-Flow Files 4.1 Modifying The Starting Resources Ric will update his Starting Resources file before running the Cash Flow Report. This allows him to change the starting date for his analysis and ensures that these items reflect his current financial situation. The five Starting Resource items will be summed and shown collectively on his Cash Flow Report, or he may view them individually through the Starting Resources Report. He has indicated a minimum balance for these resources. This will be useful in spotting cash flow problems in the output reports. 4.2 Adding And Changing The Budget Transactions 4.2.1 Known Versus Estimated Transactions Most of Ric's expenses are predictable. His mortgage payment is a fixed amount, due on the first of each month. For these transactions he can enter the period and amount without further deliberation. Other expenditures, such as the grocery bill, vary from time to time. In this case, Ric estimates a workable amount for the transaction. This is flagged for his attention on the output reports and may later be revised to reflect the true expense. 4.2.2 Recurring Versus One Time Transactions Ric's mortgage, paycheck, and credit card transactions recur in a periodic cycle. He indicated this period when entering transactions. Last month he used his credit card extensively and will pay more than the regular amount due for this month only. He compensates for this variation by entering a one time transaction for the amount that the payment is over his regular amount. One time transactions can also be used to allocate money for a special expense such as his vacation. 4.2.3 Classifying The Transactions PC-Flow allows each transaction to be classified by group. When entering transaction expenditures concerning his house such as the mortgage, insurance, and maintenance costs, Ric indicates that these are to be classified as housing expenses. This enables him to see the combined expenditures of all the transactions related to his housing expenses. Similar predefined categories exist to classify items such as income, clothing, food, home operation, housing, savings, transpor- tation, and general expenses. A transaction's classification determines whether its dollar amount is treated as an expense or income item. There is only one income classification, 'INC'; all others are expense classifications. 9 CHAPTER 5 Using PC-Flow As A Planning Tool 10 PC-Flow 1 User Manual Using PC-Flow As A Planning Tool 5.1 Starting Resources In its simplest form, Ric could enter zero money for his Starting Resources. In this case, his financial analysis would be based solely on income and expense transactions over the specified time period. Ric prefers a more interesting use of this facility. He maintains separate entries for each of his savings and checking accounts. By using the minimum balance feature he can ensure that all personal checks will be covered in his checking account and that he maintains a "buffer" amount in his savings account for the unexpected. 5.2 Budget Transactions "Oops... I seem to be a little short for the mortgage!" R. Shaw. Some budget transactions are flexible in their execution date and amount. Some are not. Having run the Cash Flow Report, Ric sees that he will be a little short for the mortgage next month. To accommodate this, he adjusts the date and amount of his credit card payment since this is a flexible payment. He may decide that a short term loan is necessary. PC-Flow can help him determine the amount and term of the loan, through altering the budget transactions and the ending date for the analysis. 11 CHAPTER 6 PC-Flow Reports -- Their Features 12 PC-Flow 1 User Manual PC-Flow Reports -- Their Features 6.1 Starting Resources Report Ric uses the Starting Resources Report to confirm the amount of cash that he has at the beginning of the analysis. He can see the summed total of these items, or view them individually, as well as the minimum balances that he has set. The date set with the Starting Resources is important since it is used by other reports as the starting date to apply the Starting Resources to the income and expenditures for budgetary analysis. This date can be changed by modifying the Starting Resources file. 6.2 Transaction Reports The Transaction Reports exhibit the ledger of income and expense items. Ric can document and confirm his transactions by looking at this report. The Transaction Reports offer more flexibility than would a written ledger. Ric can have the transactions listed by (1) transac- tion ID number, (2) frequency of recurrence, (3) transaction ending date, or (4) classification. This will assist him in planning his allocation of expenditures for both the date and amounts that he will pay. Ric may see that he is spending more than he thought in a certain area, and can look for ways of decreasing this expense. A listing by transaction ID number will assist him when he modifies this file. 6.3 Cash Flow Report The real picture of Ric's financial situation is obtained by looking at the Cash Flow Report. He can pick any time period. The start date is modified through the Starting Resources file. The ending date can be any date later than this. Each transaction is shown as it occurs throughout the time period. This is followed by his cash balance as a result of that transaction. Estimated transactions are highlighted with a question mark. Low cash flow balances are high- lighted with an asterisk. Ric uses this report often, especially when he would like to know how he will stand financially at any given date. 6.4 Net Cash Flow Report To view his net cash flow changes from day to day, week to week, month to month, or year to year, Ric uses the Net Cash Flow Report. It shows him the beginning and ending balances as well as the total for any income and expense items across time periods of days, weeks, months, or years. The starting and ending dates for this report work in the same way as for the Cash Flow Report. 13 PC-Flow 1 User Manual PC-Flow Reports -- Their Features 6.5 Classification Breakdown Report Ric is thinking of moving from his house into an apartment. He would like to see how much the house has been costing him, and there- fore, how much money he could save by going to an apartment. The Classification Breakdown Report will sum such items as mortgage, in- surance, maintenance, etc. that Ric has classified as housing expenses. In addition, this report shows the percentage of total expenses that Ric is spending on housing. Ric can use this facility to sum any of the transactions that have been classified as income, clothing, food, home operation, housing, savings, transportation, or general expense. 6.6 Old Transactions Report After Ric has been using PC-Flow for a number of months, he notices that there are quite a few transactions that are no longer needed for his budget planning. Some transactions have an ending date less than the starting date for the analysis. To clean the data files of these transactions, Ric can use the facility on menu 3, option 2. However, before purging these old transactions, he would like to have a hard copy of the transactions that PC-Flow would purge. This report shows Ric the transactions that would be purged by running the Purge Old Transactions facility -- provided that the same date is used for both the report and the purge facility. 6.7 Determining A Date Range For The Analysis The budget analysis reports cover a specific time period. The dates chosen will depend on the type of analysis desired. The starting date is determined by the date set in the Starting Resources file. The ending date is chosen when running the reports. A period of a few weeks to a few years may be selected depending on whether a short or long term analysis is desired. 6.8 Using PC-Flow On A Regular Basis After Ric has been using PC-Flow for a while, he begins to develop a pattern of use whenever analyzing his budget. He first updates his Starting Resources to reflect the current situation. Next, he updates and adds any transactions if required. Then, using the Cash Flow, Net Cash Flow, or Classification Breakdown Report to analyze his budget, he will go back and change the input data until satisfied about his planned budget. To document all of this when finished, he prints out the Starting Resources Report and the Transactions Report plus any of the analysis reports that were useful. He can, at some point in the future, use these printed reports to determine if he should redo his budget analysis. 14 CHAPTER 7 What To Do If PC-Flow Misbehaves 15 PC-Flow 1 User Manual What To Do If PC-Flow Misbehaves 7.1 PC-Flow Execution Errors Serious run time errors that cause PC-Flow to stop execution can happen for a number of reasons. The most likely errors are DOS oriented, such as being out of RAM (DOS error 8) or having a required file not available (DOS error 2). Other errors can exist because of program bugs. Should you be faced with a query on the upper right hand corner asking you to answer "Q, A, or I", answer 'Q' to quit PC-Flow or 'I' to ignore the problem and continue. Use 'A' to abort only as a last measure since it may not properly close files that are open. If the problem persists, contact Danlware Systems Corporation. The address is shown on the title page of this manual. 7.2 Emergency Exit Out Of PC-Flow To exit out of PC-Flow in an emergency, use the Alt-C key combina- tion. Answering 'Q' to the subsequent query will result in exit from PC-Flow with the data files being properly closed. In the case that your computer locks up, you may have to re-boot it using either the Alt-Ctrl-Del key combination or power off and on. 16 CHAPTER 8 Tips And Techniques 17 PC-Flow 1 User Manual Tips And Techniques 8.1 Recurring Estimates -- Regular Credit Card Use Because it is difficult to know a correct transaction amount to use for such things as a credit card, a workable estimate should be input. Whenever a notable discrepancy occurs between the estimated and actual amount, a supplemental one time transaction can be input to take care of the difference. When the actual amount is known, it may already be in the past. In that case, the discrepancy may be ignored since the Starting Resource amounts and date can be updated according- ly. 8.2 Saving Money A simple strategy for saving money in a savings account is to treat that transaction as any other expense. When it comes time to update the Starting Resource amounts, and the savings account is one of the Starting Resource accounts, you may change the minimum balance for that account. In that way, your savings are protected from being used for expense coverage without PC-Flow warning you. Long term savings can be classified as a savings expense and not kept in the Starting Resources. 8.3 Planning For A Big Expense The most straightforward way of planning for a major expense is to enter a one time transaction for that expense. In such a case, with a date range extended well past the planned expense, the Cash Flow Report will show the effects of that expense -- perhaps a few months past the expense. That would ensure that the effect of the expense on the cash flow would be fully observed. Possibly, a loan will be needed to help the cash flow. 8.4 Reducing The Memory Requirements Of The Data Files As you use the system over time, many transactions will be entered into the data files. As they expire -- as noted in the ending date field -- they can be purged. Old transactions may be purged using menu 3, option 2. This will reduce the amount of space needed on your disk to store the data. To confirm which transactions will be purged, use option 4 on the same menu. If you have a serious shortage of disk space, then the analysis time period may be shortened so that the file which stores the analyzed data is kept small. 18 CHAPTER 9 In The Future 19 PC-Flow 1 User Manual In The Future 9.1 Features To Come Many future enhancements are planned for PC-Flow. Among these are: the ability to add and change the transaction classifications (there are eight predefined now); a new type of transaction that is dependent on the execution of others; and more analysis reports. Your comments are welcome concerning new features for PC-Flow. 20 PC-Flow 1 User Manual GLOSSARY DOS Disk Operating System. Sometimes known as PC-DOS or MS-DOS. KB One KB (kilo-byte) is equal to 1024 bytes. One alphabetic character may be stored in one byte. It is used in reference to computer internal and external memory space. Minimum Balance This amount is set with the Starting Resources. Each Starting Resource item may have a minimum balance associated with it. The sum of these amounts is used by PC-Flow as the minimum balance used in the analysis of the transactions. For example, on the Cash Flow Report (menu 2.1), any balance below the minimum balance is output with an '*' character to its right. PC Personal Computer. Also referred to as an IBM-PC or a compatible look alike. RAM Random Access Memory. This is the memory that your personal computer uses to execute programs. Recurring Transaction A transaction that occurs more than once in a known period of time such as a day, week, or month. For example, loan payments are usually done once every month. Running Transactions Same as transformed transactions. 21 PC-Flow 1 User Manual Glossary Shareware Also known as freeware. A concept for software distribution whereby the user can copy and evaluate software without having to pay full costs of purchasing it. It is not public domain software. Regular users are asked to make a donation to the author in return for addi- tional services; they then become registered users. Starting Resource Item One of the five components of the Starting Resources. Each Starting Resource item reflects a different area of where you are keeping your money. For example, your bank checking account may be entered as one Starting Resource item. Starting Resources The sum of the five Starting Resource items. This is money that will be used to cover expenses on a day-to-day basis. Contrast this to retirement savings which would not (normally) be part of the resources. This money reflects the cash situation at the beginning of the budget- ary analysis. Transaction An expense or income item that may occur once or repeatedly. For example, a grocery transaction may occur every week and a pay bonus transaction may occur only once. Transformed Transactions These are transactions that have been positioned with a scheduled execution date in a temporary data file. The input transactions are transformed so that they may be analyzed over time. For example, the Cash Flow Report uses the transformed transaction to output the cash flow analysis. 22