2 min read
Definition
A cash flow forecast projects the money expected to flow in and out of a business over a future period, giving a running view of the bank balance. It is the central tool of cash management, showing shortfalls before they arrive.
In plain terms
Built by listing expected receipts and payments by date and carrying the balance forward, a forecast turns cash management from reactive to proactive. The short-horizon version — a rolling 13-week forecast — is the standard control tool.
Why it matters
A good forecast is the difference between seeing a problem coming and being ambushed by it. See the 13-week forecast and how to forecast cash flow.
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