How do I build a cash-flow forecast? — Answers

2 min read

13 weeksUseful horizon

Cash, not profitTiming matters

RollingUpdate weekly

How to build it

List every expected receipt (customer payments, by their likely pay date, not invoice date) and every payment (wages, suppliers, VAT, rent, loan repayments) week by week. Start from your current bank balance and roll it forward. Use the cash-flow forecast template so the structure is done for you — you just fill in the numbers.

Keeping it useful

A forecast is only worth anything if it is honest about timing — money arrives when customers actually pay, which the UK's late-payment habits make later than the invoice suggests. Update it weekly, and when it shows a dip, act early: chase invoices, delay non-urgent spend, or draw on a facility. Troubleshoot recurring dips with the cash-flow troubleshooting guide.

What it means for you

Credicorp lends to your company, not to you personally, and takes no personal guarantee. See business loans or apply online.

Frequently asked questions

How far ahead should a cash-flow forecast go?

A rolling 13-week (one-quarter) forecast is the practical sweet spot — near enough to be accurate, far enough to give warning. Longer annual forecasts are useful for planning but less reliable week to week.

What is the most common forecasting mistake?

Recording income on the invoice date rather than the likely payment date. Customers pay late, so forecasting on invoice dates makes the cash position look healthier than it is.