This is a Working Example of our Forecasts
Registered users can produce their own business forecasts in minutes; exactly as is shown here.

Report name: Sample Forecast

Forecast Cash Flow and Bank Balances Budget

This is a working example of forecast cash flows, unused overdraft, other financial facilities and monthly bank accounts that we produce.

Year 5May-21Jun-21Jul-21Aug-21Sep-21Oct-21Nov-21Dec-21Jan-22Feb-22Mar-22Apr-22
Revenue
 Capital000000000000
 Loans000000000000
 

Asset Finance Debt

3,5583,5583,5583,5583,5583,5583,5583,5583,5583,5583,5583,558
 Sales Ledger Cash48,45584,90476,52687,45879,259120,255194,048233,677136,65386,09276,526106,590
 DR/CR Cards24,16017,25724,16017,25731,06251,77165,57627,61120,70817,25731,06217,257
 Cash Sales2,4531,7522,4531,7523,1545,2566,6572,8032,1021,7523,1541,752
 Assets Sold000000000000
 VAT refunds000000000000
 Total78,625107,471106,697110,025117,033180,840269,840267,650163,022108,659114,300129,157
             
 Cash Out: Purchases
 Purchases43,44073,15060,82174,33763,074103,621166,695197,106100,24268,70661,94892,358
 L/C Issued000000000000
 Total43,44073,15060,82174,33763,074103,621166,695197,106100,24268,70661,94892,358
             
 Cash Out: Operating Overheads
 Wages25,00025,00025,00025,00025,00025,00025,00025,00025,00025,00025,00025,000
 Overheads11,87516,81516,69917,27516,98719,72323,61124,47518,93116,98716,91518,283
 Bank Charges676767676767676767676767
 Factoring Charges000000000000
 Total36,94141,88141,76542,34142,05344,78948,67749,54143,99742,05341,98143,349
             
 Cash Out: non Operating
 Fixed Assets5,0835,0835,0835,0835,0835,0835,0835,0835,0835,0835,0835,083
 

Asset Finance Payments

01482974455937418901,0381,1861,3341,4831,631
 

Asset Finance Settlements

000000000000
 Loans Repaid000000000000
 VAT on Imports2,1181,5132,1181,5132,7244,5405,7502,4211,8161,5132,7241,513
 Vat Remitted4,000005,7310012,4320015,11200
 Total11,2026,7457,49812,7738,40010,36424,1558,5428,08523,0439,2908,227
             
 

Cash Out- Tax, Interest and Dividend

 

Interest Charged

229380441637643494275208237438462619
 

Tax

000000006,000000
 

Dividend

000000000000
 

Interest, Tax & Dividend

2293804416376434942752086,237438462619
             
 Forecast Bank Account
 

Bank Bfwd

-14,500-27,686-42,371-46,201-66,263-63,400-41,829-11,7934604,920-20,661-20,042
 

All Revenues

78,625107,471106,697110,025117,033180,840269,840267,650163,022108,659114,300129,157
 

All Outgoings

91,812122,156110,526130,088114,170159,269239,803255,397158,562134,240113,681144,554
 Bank Cfwd-27,686-42,371-46,201-66,263-63,400-41,829-11,7934604,920-20,661-20,042-35,439
             
 Forecast net cash and finance
 Cash @ bank-27,686-42,371-46,201-66,263-63,400-41,829-11,7934604,920-20,661-20,042-35,439
 

Overdraft Limit

50,00050,00050,00050,00050,00050,00050,00050,00050,00050,00050,00050,000
 Undrawn Factoring000000000000
 

Bank plus Undrawn Financing

22,3147,6293,799-16,263-13,4008,17138,20750,46054,92029,33929,95814,561
Year 5May-21Jun-21Jul-21Aug-21Sep-21Oct-21Nov-21Dec-21Jan-22Feb-22Mar-22Apr-22
Revenue
 Capital000000000000
 Loans000000000000
 

Asset Finance Debt

1,0501,0501,0501,0501,0501,0501,0501,0501,0501,0501,0501,050
 Sales Ledger Cash82,77993,53282,82594,65785,783130,153210,019252,911147,90193,17882,825115,363
 DR/CR Cards26,48818,92026,48818,92034,05656,75971,89530,27222,70418,92034,05618,920
 Cash Sales4,0342,8814,0342,8815,1868,64410,9494,6103,4572,8815,1862,881
 Assets Sold000000000000
 VAT refunds000000000000
 Total114,351116,383114,396117,508126,074196,606293,913288,842175,112116,029123,116138,214
             
 Cash Out: Purchases
 Purchases62,99373,63060,19573,57262,425102,555164,979195,07799,21167,99861,31091,407
 L/C Issued000000000000
 Total62,99373,63060,19573,57262,425102,555164,979195,07799,21167,99861,31091,407
             
 Cash Out: Operating Overheads
 Wages25,83325,83325,83325,83325,83325,83325,83325,83325,83325,83325,83325,833
 Overheads16,91020,46620,26920,90220,58523,59527,87228,82222,72420,58520,50622,011
 Bank Charges100100100100100100100100100100100100
 Factoring Charges000000000000
 Total42,84346,39946,20246,83546,51949,52853,80554,75548,65746,51946,43947,944
             
 Cash Out: non Operating
 Fixed Assets1,5001,5001,5001,5001,5001,5001,5001,5001,5001,5001,5001,500
 

Asset Finance Payments

1,7791,8231,8671,9101,9541,9982,0422,0852,1292,1732,2172,260
 

Asset Finance Settlements

000000000000
 Loans Repaid000000000000
 VAT on Imports4,6103,2934,6103,2935,9279,87912,5145,2693,9523,2935,9273,293
 Vat Remitted5,731007,8990016,3980019,79800
 Total13,6216,6167,97714,6029,38213,37732,4538,8547,58126,7649,6447,053
             
 

Cash Out- Tax, Interest and Dividend

 

Interest Charged

697797812974926683408417426435443452
 

Tax

0000000013,613000
 

Dividend

000000000000
 

Interest, Tax & Dividend

69779781297492668340841714,038435443452
             
 Forecast Bank Account
 

Bank Bfwd

-35,439-41,242-52,301-53,092-71,567-64,744-34,2817,98637,72543,35017,66422,943
 

All Revenues

114,351116,383114,396117,508126,074196,606293,913288,842175,112116,029123,116138,214
 

All Outgoings

120,154127,442115,186135,983119,251166,143251,646259,104169,487141,715117,837146,857
 Bank Cfwd-41,242-52,301-53,092-71,567-64,744-34,2817,98637,72543,35017,66422,94314,300
             
 Forecast net cash and finance
 Cash @ bank-41,242-52,301-53,092-71,567-64,744-34,2817,98637,72543,35017,66422,94314,300
 

Overdraft Limit

50,00050,00050,00050,00050,00050,00050,00050,00050,00050,00050,00050,000
 Undrawn Factoring000000000000
 

Bank plus Undrawn Financing

8,758-2,301-3,092-21,567-14,74415,71957,98687,72593,35067,66472,94364,300
Year 5May-21Jun-21Jul-21Aug-21Sep-21Oct-21Nov-21Dec-21Jan-22Feb-22Mar-22Apr-22
Revenue
 Capital000000000000
 Loans000000000000
 

Asset Finance Debt

3,1503,1503,1503,1503,1503,1503,1503,1503,1503,1503,1503,150
 Sales Ledger Cash94,671140,403130,266148,875134,918204,703330,316397,775232,617146,549130,266181,441
 DR/CR Cards8,8136,2958,8136,29511,33118,88423,92010,0727,5546,29511,3316,295
 Cash Sales7,1575,1127,1575,1129,20215,33719,4278,1806,1355,1129,2025,112
 Assets Sold500500500500500500500500500500500500
 VAT refunds000000000000
 Total114,291155,461149,886163,932159,101242,575377,314419,677249,956161,606154,449196,499
             
 Cash Out: Purchases
 Purchases64,57192,27576,75293,80879,595130,762210,357248,733126,49886,70178,173116,549
 L/C Issued000000000000
 Total64,57192,27576,75293,80879,595130,762210,357248,733126,49886,70178,173116,549
             
 Cash Out: Operating Overheads
 Wages27,50027,50027,50027,50027,50027,50027,50027,50027,50027,50027,50027,500
 Overheads21,39725,16024,74725,59225,16929,18234,88536,15228,02125,16925,06427,070
 Bank Charges125125125125125125125125125125125125
 Factoring Charges000000000000
 Total49,02252,78552,37253,21752,79456,80762,51063,77755,64652,79452,68954,695
             
 Cash Out: non Operating
 Fixed Assets4,5004,5004,5004,5004,5004,5004,5004,5004,5004,5004,5004,500
 

Asset Finance Payments

2,2902,2602,2342,2092,1882,1682,1461,4331,5511,6691,7861,904
 

Asset Finance Settlements

350350350350350350350350350350350350
 Loans Repaid000000000000
 VAT on Imports9,7656,9759,7656,97512,55520,92526,50411,1608,3706,97512,5556,975
 Vat Remitted7,8990010,6060021,4520025,79000
 Total24,80314,08516,84824,64119,59227,94354,95317,44314,77139,28419,19113,729
             
 

Cash Out- Tax, Interest and Dividend

 

Interest Charged

552585549620556434429287310334357381
 

Tax

0000000018,495000
 

Dividend

000000000000
 

Interest, Tax & Dividend

55258554962055643442928718,805334357381
             
 Forecast Bank Account
 

Bank Bfwd

14,300-10,357-14,626-11,262-19,615-13,05113,57862,643152,081186,317168,810172,848
 

All Revenues

114,291155,461149,886163,932159,101242,575377,314419,677249,956161,606154,449196,499
 

All Outgoings

138,947159,730146,521172,285152,537215,946328,249330,239215,720179,113150,410185,354
 Bank Cfwd-10,357-14,626-11,262-19,615-13,05113,57862,643152,081186,317168,810172,848183,993
             
 Forecast net cash and finance
 Cash @ bank-10,357-14,626-11,262-19,615-13,05113,57862,643152,081186,317168,810172,848183,993
 

Overdraft Limit

50,00050,00050,00050,00050,00050,00050,00050,00050,00050,00050,00050,000
 Undrawn Factoring000000000000
 

Bank plus Undrawn Financing

39,64335,37438,73830,38536,94963,578112,643202,081236,317218,810222,848233,993

Figurewizard and Cash Flow Forecasting

This is a working example of Figurewizard's analysis of month-by-month cash flow. Net cash flow plus the bank and undrawn and available financing such as overdraft or factoring / supply chain finance represent net cash resources.

Any month or months showing a deficit in Bank plus Undrawn Financing will call for changes in your original forecasts for gross margin, overheads, investment or financing until the deficits are eliminated.The What-If Calculator and Planner will be ideal for this.

Cash Flow Forecasting and the Bank

A company that is enjoying significant expansion is going to be just as vulnerable to cash flow deficits as one with poor trading.

This is because in the short term, especially when selling on open credit, buying merchandise or services for resale by short term credit or by letter of credit, the usage of cash is likely to peak sharply ahead of peak trading periods.

Financing cash flow shortfalls should not be difficult as long as the forecasts you have created with Figurewizard accurately illustrate profitable trading, and investment in fixed assets over and above the ability of operating cash flow to adequately service the costs of financing them.

Current Assets and Cash Flow

The following tables illustrate how using Figurewizard when planning investments in stock-in-trade or capital items can improve monthly net cash flows.

For example going to the What-If calculator and reducing Year 1 value of stock / inventory (125,000) successively by 10% will produce improvements in available bank and cash resources for the business as follows:

Stock / Inventory Year 1 less Stock / Inventory Value MIN. Monthly Bank+Undrawn Max. Monthly Bank+Undrawn Negative Months Increase / Decrease Borrowings Bank @ Year-End
0% 125,000 -16,263 54,920 2 53,854 -35439
10% 112,500 -13,853 65,081 2 41,245 -22,830
20% 100.000 -11,442 75,235 2 28,665 -10,250


The bank overdraft limit that applies in year 1 of this sample forecast is 50,000. If factoring is selected, undrawn factoring cash is included in "Min & Max Monthly."

Fixed Assets and Cash Flow

Lower year-end stock inventory means better cash flows. The same applies to reduced investment in fixed assets. In this sample forecast new main pool fixed assets (plant & machinery, fixtures equipment and commercial vehicles) are set at 30,000 for year 1 and at 25,000 for new company cars; a total of 55,000.

As this second example shows reducing stock / inventory again by 10% while cancelling first new cars and then new main pool assets illustrates even more significant benefits to cash flow.

New Fixed Assets Year 1 Stock / Inventory Value MIN. Monthly Bank+Undrawn MAX. Monthly Bank+Undrawn Months Overdrawn Increase / Decrease Borrowings Bank @ Year-End
55,000 125,000 -16,236 54,920 2 53,854 -35,439
30,000 112,500 -10,857 73,508 2 15,007 -10,082
0 100,000 -5,644 92,650 1 -30,162 15,662

Applying a Temporary Loan to Cash Flow

Where a temporary loan other than increasing the bank overdraft or factoring is the preferred cash flow option, this can be added by selecting "edit the forecast" and going to the Capital and Bank form. Better however is to simply go to the What-If Calculator and select the option there for how much and for how long.

Short Term Borrowings and Cash Flows

The two deficit months in this original forecast's results would therefore be eliminated by a short term loan of £14,000 without having to make reductions to stock / inventory, fixed assets or overheads. In the longer term though, those reduction should still be considered. 

Persistent monthly shortfalls for cash means that corrective action will become important in order to safeguard the business. If the cause is related to significant expansion (which almost always will have a negative impact on cash flows) then longer term solutions will be called for.

Factoring / Invoice Discounting and Cash Flow

For a company selling the bulk of its products on open credit fatoring / invoice discounting can be the ideal solution. There are costs, for example a small service charge on invoicing and of course interest but that will be far cheaper than ignoring the problems and eventually suffering their consequences.

The cash flow that result can transform a growing company's prospects as our Interactive Factoring and Cash Chart makes clear. 

Dealing with the right providers is important though and the thing to look out for is whether or not a factor / invoice discounter is a member of the Asset Backed Finance Association; now incorporated into the UK Finance Association.

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