Annual budgets rarely help with next month's payroll. A short horizon rolling cash forecast does, provided it is maintained honestly.
Choose the right horizon
Thirteen weeks balances visibility with accuracy. Longer horizons become estimates, shorter ones leave no room to act.
Build from receipts and payments, not profit
Forecast actual expected receipts by customer and payments by supplier. Profit based conversions hide timing risk.
- Customer level receipt expectations with confidence levels
- Committed supplier and payroll payments by week
- Debt service, tax and capital commitments listed separately
Reconcile every week
Comparing forecast against actual each week is what builds accuracy and trust. Variance analysis improves the next forecast.
Key takeaways
- Use a thirteen week rolling horizon
- Forecast receipts and payments directly
- Reconcile forecast to actual weekly
Related service
Crevaty Advisory