Cash‑Flow Forecasting & Budgeting

Typically 12–24 months with scenarios. We typically build cash flow forecasts that project 12 to 24 months ahead, providing visibility into both near-term and medium-term cash positions. Forecast horizons depend on your needs-short-term monthly forecasts focus on operational cash management, while longer-term annual forecasts support strategic planning and financing needs. We also develop multi-year forecasts when needed for strategic planning or financing purposes. However, forecast accuracy generally decreases as the projection period extends, so we focus on providing detailed near-term projections with broader longer-term estimates. We build multiple scenarios including base case, conservative, growth, and stress test scenarios to help you understand potential outcomes under different conditions. Scenario planning helps assess risks and opportunities, but actual results may differ from any scenario. Forecast horizons are tailored to your needs, but we typically recommend 12–24 month projections with regular updates as actual results become available.

Yes-rolling forecasts with actuals. We provide rolling forecast updates that incorporate actual results and adjust projections based on changing business conditions. Monthly updates are common for businesses that need regular cash flow visibility, while quarterly updates may be sufficient for others. Rolling forecasts typically involve updating the forecast period as each month or quarter passes, incorporating actual revenue, expenses, and cash flow results, and adjusting future projections based on performance trends and updated assumptions. This approach keeps forecasts current and relevant rather than relying on stale projections. However, update frequency depends on your needs and engagement scope-some businesses need monthly updates for operational cash management, while others may need less frequent updates for strategic planning. We work with you to determine the appropriate update cadence based on your business needs, but regular updates help ensure forecasts remain useful and accurate. Update frequency and scope are discussed as part of engagement planning, but we typically recommend monthly or quarterly rolling forecast updates.

Yes-assumptions and sensitivities are built in. We build cash flow models that include assumptions and sensitivity analysis for price changes, foreign exchange impacts, volume variations, and other key variables. Price change modeling allows you to test how changes in selling prices or input costs affect cash flow, while FX modeling helps assess currency exchange rate impacts for businesses with international operations or transactions. Sensitivity analysis tests how changes in key assumptions affect cash flow outcomes, helping you understand which variables have the most impact on cash positions. However, sensitivity analysis depends on accurate assumption inputs and understanding of business drivers-we build models with sensitivity capabilities, but assumption accuracy affects sensitivity results. We work with you to identify key assumptions and variables to model, but sensitivity analysis effectiveness depends on realistic assumption ranges and understanding of business relationships. Price and FX modeling capabilities are built into forecasts, but specific modeling depends on your business model and needs.

We typically need historical financial data, business information, and assumptions to build accurate cash flow forecasts. Historical data includes financial statements, cash flow records, and accounting records that show past revenue, expenses, and cash flow patterns. Business information includes understanding your business model, revenue streams, expense structure, working capital cycles, and key business drivers. We also need assumptions about future performance such as expected growth rates, pricing changes, volume projections, expense trends, and other factors that will affect future cash flow. However, data requirements depend on forecast complexity and your business model-simple forecasts may need basic financial statements, while complex forecasts may require detailed operational data, customer information, or other business-specific data. We discuss data requirements based on your needs, but timely access to accurate, complete historical data is essential for building reliable forecasts. Data quality and completeness affect forecast accuracy, so we work with you to ensure we have the information needed to build meaningful projections. We coordinate with Business Accounting Services when historical data needs preparation or cleanup, but forecast accuracy depends on data quality and assumption validity.

Scenario maintenance and forecast ownership depend on your engagement scope and preferences. We typically build initial scenarios including base case, conservative, growth, and stress test, and we can maintain and update these scenarios as part of ongoing forecast services. Scenario maintenance involves updating assumptions, incorporating actual results, and adjusting projections based on changing business conditions. However, scenario maintenance frequency and responsibility depend on your engagement-some businesses prefer we maintain scenarios with regular updates, while others may take ownership of scenario maintenance after initial setup. Forecast ownership typically remains with your business-you own the forecast models and can use them for planning and decision-making. We provide forecast development and update services, but you maintain control over how forecasts are used and updated. However, effective scenario maintenance requires ongoing attention to actual results, assumption validity, and business changes-we can provide update services, but maintaining current scenarios requires regular review and adjustment. We discuss scenario maintenance and forecast ownership as part of engagement planning, but we typically recommend regular scenario reviews and updates to keep forecasts relevant. Ownership and maintenance responsibilities are clarified during engagement setup, but we work to ensure forecasts remain useful tools for your business planning.