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Are there any good resources available for Cash Flow Forecasting?

cash flow template

I'm looking for any type of available resource or documentation, that explains some processes for forecasting cash flows.  Thanks.


Topic Expert
Regis Quirin
Title: Director of Finance
Company: Gibney Anthony & Flaherty LLP
LinkedIn Profile
(Director of Finance, Gibney Anthony & Flaherty LLP) |

I complete all of my financial modeling using excel. The proper projection of revenues and expenses; as well as when they occur is critical to your model. I have never seen a package that could replace the flexibility of a spread sheet model.

Sarah Jackson
Title: Associate Editor
Company: Proformative
(Associate Editor, Proformative) |

Andrew, you might want to take a look at this informative and free Excel template here at Proformative. It has a section on cash flow:

Also if you haven't already, you should definitely get your free copy of

"The Proformative Community Guide To ERP Selection & Implementation:"

It sounds like it would be right up your alley.


Best... Sarah

David Belgum
Title: CFO
Company: LeoNovus, Inc.
(CFO, LeoNovus, Inc.) |

I have found using excel to be an adequate tool for forecasting cash flow. The difficult part of forecasting is projecting an income statement and changes in key balance sheet items with reasonable accuracy. For the balance sheet, this might involve forecasting as few items as AR, inventory, AP and debt. Doing this should result in a useful cash flow forecast. A place to start if you don't have a model to work with is to search for an excel template by going to File/New in excel.

Martin Buckle
Title: President
Company: Bjorklund & Company
(President, Bjorklund & Company) |

I have used a number of tools including Excel, IBM Cognos, Hyperion, Oracle. The advantage with Excel is that almost everybody already has the software and knows how to use it. This keeps down your costs from the point of view of licenses, training and maintenance. As mentioned before Excel also has the advantage of being flexible, as well as easy to format and integrate with presentations. You can produce Monte Carlo simulations, Tornado charts etc. The downside in a complex scenario is that it can be difficult to maintain data integrity and avoid programming error. Additionally, Excel models can be very personal and what makes sense to one person may not to someone else - if the modeler leaves you can struggle to pick up someone else's work.

The advantage of the modeling software programs really comes in complex scenarios with multi-currency, multi-product, multi-jurisdiction environments. Here Excel's flexibility could cause you a lot of trouble. If you have a lot of people supplying data a tool that enables you them to submit their information via the cloud (eg IBM Cognos) could help you enormously. The problem can be finding the budget to implement and maintain a separate tool. You will likely have to be able to compare forecast data with actuals so make sure you can upload and download data to a common comparison tool.

Topic Expert
Henry Schumann
Title: Manager FP&A
Company: Allscripts
(Manager FP&A, Allscripts) |

Probably need a quick clarification on whether you are trying to build a statement of cash flows as part of your financial statements or whether you want to forecast your cash on hand at a given point in the future.

If the former, there are lots of forecasting software options available or as others have noted Excel can be fine too.

If the latter, then I suggest simply setting up a 3 column spreadsheet with debit, credit, and balance as your headers. As you expect money to come in list it in the debit column. As you expect money to go out list in credit column. Then let the balance column = prior balance plus all debits less all credits. Then you'll know what the expected cash on hand will be after all the events occur in your forecast.

Andrew Rosenberg
Title: Financial Analyst
Company: NorthStar Financial Services Group, LLC
(Financial Analyst, NorthStar Financial Services Group, LLC) |

I'm basically trying to forecast the overall cash position on a monthly basis, 12 months into the future. We have a forecasting tool (Adaptive Planning) where I have the income statement projected and it drives the balance sheet, with the cash flow statement automatically generated based on the monthly balance sheet account deltas. The problem I'm running into is the methodology for forecasting balance sheet accounts. As an example, I've projected A/R as a % of gross revenue using prior period averages where it makes sense (i.e, averages for January for the past 3 years, or 1st month of each quarter, etc). Problems can arise when small % variations in this ratio will cause large variances due to being driven by a relatively large account such as sales. Some months the projections can be completely irrelevant. Obviously this will depend on the industry, but was hoping for resources that gave examples on how other companies might have built out balance sheet/cash flow projections, with drivers, methodology,etc. Thanks to everyone for the replies.

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