Key points
- Thirteen weeks (one quarter) is short enough to be accurate and long enough to act.
- Forecast actual cash timing, not revenue and expenses.
- Update weekly and compare actuals to forecast so it gets more accurate over time.
Why weekly, why 13 weeks
Monthly profit-and-loss statements hide timing. Payroll, rent, HST remittances and large supplier payments can all land in the same week. A weekly view over one quarter shows the pinch points in time to talk to the bank, chase receivables or defer spending.
Building it
- Opening cash: start from the reconciled bank balance.
- Receipts: use the AR aging and each customer's actual payment behaviour, not invoice terms, to place collections in the week you expect the cash.
- Payroll: net pay on each pay date, and source deductions on their remittance dates.
- Fixed payments: rent, loan payments, leases, insurance, subscriptions.
- Suppliers: from the AP aging and expected purchases.
- Taxes: GST/HST and corporate instalments on their due dates.
- Net and closing cash for each week, against a minimum cash buffer you set.
Keeping it useful
- Each week, record actuals, roll forward one week, and explain large variances.
- Flag any week where closing cash falls below the buffer, and note the action you will take.
- Keep assumptions visible. Lenders and investors will ask for them.
Official sources
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