Cash Flow Projection

The Cash Flow Projection report presents the user with a Running Net balance of cash flow based upon anticipated Accounts Receivable payments and Accounts Payable demand. This report projects forward for the upcoming 45 days, The intent of the report is to assist in recognizing when cash flow may be tight or in excess. These indicators may be used to determine:

  • When to borrow or pay back against Line of Credit.
  • Need to adjust the days on which to pay vendors.
  • Recognize the need for increase focus on AR collection activities.

Days to Extend Vendor Terms

By default, vendor invoices are consider in the AP Flow based upon the actual due date of the invoice as calculated by the invoice's terms. The user may changed the value of "Days to Extend Vendor Terms" from 0 to another value. This is for playing "what if" scenarios. For example, by changing the Days to Extend from 0 to 5, the resulting data for AP Flow, Dats Net, and Running Net will vendor invoices being paid 5 days beyond their stated terms.

Days Beyond Customers Avg Days to Consider

Each customer's sales invoice is assigned an "anticipated payment receipt date" based upon the average days to pay from that customer.

By default, sales invoice up to 10 days beyond the customer's days to pay are considered in the AR Flow. For example, a customer with Net 30 Term is paying their invoices at 40 days. Adding 10 days to that brings us to 50 days. Thus invoices beyond 50 days are excluded from the AR flow as those invoices could possibly be non-collectable, or at the very least unpredictable as to when they will be paid. The user has the option to change the default value for "Days Beyond Customers' Avg Pay Days to Consider".

Initial Cash Value (optional)

This value defaults to 0. Optionally, the user could set this to some value such as $15,000. This value simply sets a "beginning balance" from which the Running Net value begins. This can be used for playing "what if " scenarios.

Below the grid of Running Net balances there exists a subreport. You can explode the contents by clicking on the "+" box icon. This list of sales invoices are those invoices which were EXCLUDED from the AR Flow because their anticipated payment receipt date fell beyond the cut off (avg days to pay + Days to Consider Beyond. Using the default example stated earlier of customer having Avg Days to Pay of 40 days plus the default 10 day buffer, invoices for that customer that exceed 50 days will be shown in this list.

Cash Flow Projection.pdf