Cashflow forecasting

Predicting how money will flow in and out of a business over time is crucial when ensuring there's enough cash to cover expenses and to plan your business's future. It's an essential aspect of financial management, providing insights into the short-term financial health of your business and helping to mitigate any cash flow risks.

What is cashflow forecasting?

Warren Buffet once observed that “An idiot with a plan can beat a genius without a plan”. A financial forecast is just that: a quantified plan for your business. It is an essential tool in helping you grow your business. Many businesses that have excellent products or services still fail due to cash shortfall and inaccurate planning. Cashflow forecasts and management accounts can help to identify any likely cash surpluses which might signal opportunities to invest or expand. They may also identify potential weaknesses such as how long it takes for your debtors to pay.
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What makes us different?

Accurate financial forecasting is key to driving your business towards success. We draw on years of experience and knowledge of other successful businesses to help create accurate forecasts for yours. We use the latest software to set up the right reports for your business to help drive efficiency and cost saving. We not only build the financial plan for you, but also help you understand and interpret the financial data, enabling you to make informed decisions. We are here to provide you with the insights you need to help you save costs and exceed expectations.

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More on cashflow forecasting

Budgeting vs forecasting

Budgeting creates a baseline to compare your company’s actual results against, establishing how much the results vary from expected performance. Financial forecasting, on the other hand, is used as a tool to determine how your company should allocate its budget for forthcoming financial periods. Unlike budgeting it does not analyse variances between forecast and actual results.

Financial forecasting:

  • Is typically used to determine how companies should allocate their budgets for forthcoming periods
  • Can be created for both short-term and long term periods
  • Should be regularly updated, perhaps monthly or quarterly, in order to stay accurate
  • Can be used to help the management to adjust production and inventory levels
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