How to use the Cashflow Forecast

With the Cashflow Forecast you can project your future cashflow based on current bank balances and forecasted revenue and expenses. The cashflow is automatically calculated from the various Forecast Planners, including VAT and payment delays in revenue and expenses. No manual input is required..

Below is a step-by-step guide on how to use the Cashflow Forecast.

1. How to Start

You will find the Cashflow Forecast in Essentials -> Forecast.

Click on the field behind the Run button, and select the cash period and company from the dropdown menus.

Click on the Run button to retrieve the latest version of your cashflow forecast.

You can run this report for any period in the past to compare it to your current cash balances. This gives you insight into your earlier forecasts and determine how they compared to reality.
The forecast is calculated automatically based on your actual bank balances and forecasted revenue and expenses.
If you want to adjust the cashflow forecast, you can do so by editing the various Forecast Planners.

2. How to use the Cashflow Forecast

The Cashflow forecast has the following sections:

• Cash IN: Cash IN shows all forecasted revenues from different revenue types. (including VAT and payment delay as selected in the Revenue Planner).
• Cash OUT (Expenses): This Cash OUT shows all forecasted cost of sales, staff expenses, and operating expenses (including VAT and payment delay as selected in the Expense Planner)..
• Cash OUT (Investments): This Cash OUT shows all forecasted payments on investments and assets (including VAT and payment delay as selected in the Asset Planner).
• Cash IN/OUT (VAT): This Cash IN/OUT shows the net difference between the VAT received from revenue and the VAT paid on the cost of sales, expenses, and investments. You can set the frequency when VAT is normally paid via Update --> Settings.

3. Timing of cashflow

When calculating future cashflow, the Cashflow forecast takes VAT and payment delays into consideration. The Revenue Planner, Expense Planner, and Asset Planner allow users to select the VAT rate and expected payment delay on every detail line. This means that the cash timing can differ from the timing in the Profit & Loss.

The Staff Planner assumes that all staff expenses are paid in the same month, without any VAT involved.

The Revenue Planner is used to forecast both Revenue and Cost of Sales, and they are assumed to have the same cash pattern. This is not always appropriate, for example if you are importing and exporting (subject to different VAT regimes) and/or are keeping an inventory of products which would cause a further time delay between purchasing into inventory and selling from inventory. This can be adjusted quite easily in the Cashflow Forecast, contact us for details if necessary.

VAT is automatically added into the monthly cashflows, and redeemed according to the VAT declaration frequency (when VAT is normally paid) which you can set via Update --> Settings.

If you want to see more details, click on the More button. This will show the underlying details. If you click the same button again, the details will be hidden again.

We hope that this helps you to understand how to use the Cashflow Forecast. Keeping track of your cash inflow and outflow, and future liquidity, has never been simpler. If you have any further questions, please don't hesitate to reach out to our support team.