Cash Flow Projection Template

Profitable companies can run out of cash if they don’t know their numbers and manage their cash as well as their profits. So the opening balance in one month should equal the closing balance at the end of the previous month. Relies on real-time data, financial software, and predictive analytics tools. This content is presented “as is,” and is not intended to provide tax, legal or financial advice.

This allows you to refine your projections as time passes, helping to make your overall projection more accurate. Though you can create detailed cash flow projections manually, savvy business owners simple cash flow projection prefer to use financial planning platforms (you know, like Finmark?) to create and manage these financial reports. In the direct cash flow forecasting method, calculating cash flow is simple.

Use Automation to Build Projections Faster!

For example, if you hit a seasonal high or low, chances are that will happen again. The forecasting process requires you to review the information regularly. With this you can make accurate, informed decisions and ensure you meet important financial obligations like employee salaries and debt repayments. When your company makes a sale and invoices a customer, this counts as additional revenue in your P&L, even if you don’t have the cash in the bank yet. But some business spending (like new business assets or other capital expenditures) doesn’t reduce profitability and isn’t included in the P&L statement. Forecasting cash flow is unfortunately not a simple task to accomplish on your own.

Fortunately, spending less than an hour each month on a cash flow projection can help you identify potential cash shortfalls in the months ahead. You can then keep a running total, from week to week, or month to month, to get a picture of your cash flow forecast over time. Too many negative weeks might spell trouble, and you’ll need to do some forward-planning to make sure you can meet your commitments – e.g. paying salaries, loan payments, and rent. Equally a few positive months might signal that you’ve got money to expand or invest. Whatever resources you use, forecasting cash flow gives you the tools you need for better business planning, so you can make smart investments while still having cash on hand when you need it.

Cash Inflows

You can use this template to perform a cash flow sensitivity analysis in order to anticipate shortfalls and help your business maintain a positive cash position. This analysis can help you make more accurate cash flow predictions and inform your business decisions. This template accounts receivable template lists customers, invoice tracking details, amounts due, and outstanding balances.