Build and update a 13-week cash flow forecast

A 13-week cash forecast puts expected bank receipts and payments into thirteen dated weeks and carries each closing balance into the next opening balance. Its main output is the amount and date of the lowest spendable cash balance. Build it from invoices, payroll and payment commitments, then replace each completed week with actual bank movements.

Set up the weekly cash schedule

Choose one cutoff, such as the bank position at close of business on Friday, and use only cash available to meet the included payments. Identify restricted balances separately. List customer collections, supplier payments, payroll, rent, taxes, equipment, debt and owner movements on distinct rows. Each receipt needs an expected bank date; an invoice date alone will not place the cash in the right week.

The direct receipts-and-payments approach is consistent with the cash-flow distinction explained in IAS 7. This operating forecast is a payment-planning schedule; it does not replace a formal statement of cash flows or determine an accounting policy.

Use the same week convention for every item. A customer transfer expected on Friday belongs to that week only if that is a realistic cleared-funds date. Put an uncertain receipt in a separate case rather than assuming the oldest overdue invoice will pay first. Remove invoices already collected before the opening cash cutoff: their cash is already in the starting balance.

For each week, closing cash equals opening cash + receipts − payments. If opening cash is B2, receipts B3 and payments B4, closing cash in B5 is =B2+B3-B4. Next week's opening cell C2 is =B5, not another manually entered estimate. Extend that structure through week thirteen and locate the minimum of the closing balances. Do not insert an automatic loan to make a negative week disappear.

Move a delayed invoice once

Suppose $5,000 of the first week's receipts is a customer invoice now expected on 13 November rather than 6 November. Remove $5,000 from week one and add it to week two. Week-one receipts become $4,000 and closing cash falls to $15,000. Week-two receipts become $17,000, returning closing cash to $20,000; week three remains $22,000.

Total receipts across the three weeks have not changed. The timing still matters: with an assumed $18,000 operating reserve, the first week is $3,000 short. An invoice that pays in week two cannot cover a week-one payroll deadline. Inspect daily movements inside a week containing a large payment; Friday receipts cannot fund a payment due on Wednesday unless other cash is available.

Keep the invoice's identity beside its amount and revised collection date. Adding a new “delayed receipts” line while leaving the old item in week one counts the same cash twice. If the customer is disputing the invoice rather than merely paying late, put that collection uncertainty into the assumptions instead of continually moving an unsupported date.

Roll the forecast after the week closes

Consider a separate update to the original first week. Actual receipts are $6,000 against $9,000 forecast; actual payments are $15,000 against $14,000 forecast. Actual closing cash is $25,000 + $6,000 − $15,000 = $16,000, which is $4,000 below forecast.

If the missing $3,000 receipt is now expected in week two, that week's receipts become $15,000. With unchanged $12,000 payments, the revised closing balance is $19,000. The collection delay reverses, while the extra $1,000 payment continues to reduce cash. Do not add the delayed receipt again if the existing collection list already contains it.

After updating the completed week, add a new final week so thirteen future weeks remain visible. Check that the opening bank balance, unpaid invoice list and payment schedule all use the same cutoff. A total can reconcile while a receipt is duplicated and a different one omitted, so follow the large items as well as the total.

Use the forecast to make a dated decision

For the $3,000 reserve shortfall above, state which cash action could take effect before the payment: collect a specific invoice earlier, defer a payment where terms allow it, or receive already arranged funding. Put the action's amount, date and conditions into a separate case. A financing discussion with no committed draw date is not available cash.

Use the downside-action guide to work backward from the payment deadline. For a business not yet trading, the startup funding calculation uses the same lowest-balance logic across launch commitments.