12 month cash flow forecast template

Healthy cash flow is the difference between a thriving company and one floundering with unpaid debts and crippling liquidity issues.

Good financial planning and cash flow forecasting can allow businesses to plan investments with surplus cash or enable them to negotiate preferential rates when negotiating financing or loans.

No wonder then why everyone is now looking into short to medium term cash flow forecasting methods and techniques.

First things first. A 12 month cash flow forecast would be considered to be a medium term forecast. As such we would advise using a combination of two of the main schools of cash flow forecasting, those being the direct and indirect methods.

The Direct method, also known as the R&D method relies on catogorising all cash transactions as either Receipts(positive cash flow) or Disbursements (negative cash flow).

Receipts can include but should not be limited to, cash sales, proceeds from the sale of assets and loans.

Disbursements can involve any of the following, accounts payable transactions, refunds to customers and the repayment of loans. Payroll is also a massively important disbursement and one that nearly all companies should factor in.

By using this process all cash transactions can be quantified and their impact on cash flow assessed. By combining the indirect method known as PBS (Proforma Balance Sheet) this short term solution becomes a more strategic medium term tool.

The PBS method takes into account accruals and looks into the cash book account. The assumption in this instance is that once all balance sheets have been calculated correctly then the cash book will tally.

Below are some templates for use to compile a 12 month cash flow forecast template.



We advise you to find one that you are most comfortable with and use that one.

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