How to build a 13-week cash-flow forecast that stays useful.

Build a 13-week cash-flow forecast from the opening bank position, expected receipts and expected payments for each week. Reconcile the opening balance to the bank, document the source and owner of every material assumption, show timing uncertainty separately and refresh actuals and variances every week.

ICAEW's nine cash-flow forecasting principles support a direct-method, rolling 13-week view with documented assumptions, bank reconciliation, scenarios and independent review. Thirteen weeks is a useful operating horizon, not a universal legal requirement.

What is a 13-week cash-flow forecast?

It is a short-term, usually direct-method view of cash moving in and out by week. Unlike a profit forecast, it focuses on when money is expected to reach or leave the bank. It is used to see liquidity pressure early and coordinate action.

The forecast should distinguish available cash from accounting revenue and cost. It should also make uncertainty visible rather than hiding it inside one precise-looking number.

The seven-step build

Start at the bank and preserve a clear bridge from inputs to weekly cash. Do not add automation until the business agrees the definitions and owners.

• Reconcile the opening cash balance and identify restricted or unavailable amounts.
• Create thirteen weekly columns with consistent cut-offs.
• Forecast receipts from invoices, orders, payment behaviour and known exceptions.
• Forecast payroll, suppliers, tax, rent, debt and other cash payments using approved assumptions.
• Calculate weekly net movement and closing liquidity.
• Add a base case and specific downside or timing scenarios without overwriting the base assumptions.
• Each week, load actual cash, explain variance, roll forward and add a new final week.

How to forecast receipts and payments

Use the most direct evidence available. Near-term receipts may be based on open invoices, expected settlement dates, order data and known collection issues. Payments may be based on supplier ledgers, payroll schedules, contractual dates and approved spending plans.

Record who supplied each material assumption and when it was last confirmed. If the timing is genuinely uncertain, use an explicit scenario or confidence flag rather than an unsupported average.

Controls that keep the forecast credible

The forecast needs a named owner, controlled version, documented definitions, input deadlines, review thresholds and an approval cadence. Changes to major assumptions should be visible rather than silently overwritten.

• Opening cash agrees to an approved bank source.
• Formula or workflow checks confirm that weekly roll-forwards balance.
• Large assumptions link to a source and owner.
• Actual-versus-forecast variance is reviewed by cause and timing.
• The published view states its cut-off date, scenario and known limitations.

What to automate and what to keep human

Automation can collect bank and ledger data, roll dates, apply approved timing rules, flag missing inputs and prepare variance analysis. People should own commercial assumptions, decide scenario actions and approve the released forecast.

The goal is not an autonomous prediction. It is a faster, more consistent decision process with an inspectable trail from source to output.

Questions the weekly review should answer

The meeting should focus on decisions: what changed, why it changed, whether the lowest cash point moved, which assumptions are unconfirmed and what action has an owner. A forecast that produces no decision is reporting, not cash management.

Frequently asked questions