Planning is as important for the information systems function as for any other part of the organization. The master plan for this function should be consistent with the strategic plan for the organization and include goals and objectives. an inventory of current capacity, and a forecast of future needs. The plan is the basis for determining hardware needs.

To determine cash flow for the period, all noncash expenses should be added back to profit. Adding the US $5,000 of depreciation and the US $6,000 of discount amortization to the US $60,000 of profit produces a cash flow of US $71,000.