Cashflow forecasts are a regular request from our clients banking and financial institutions. This is because cashflow forecasts help to determine when the availability of cash within the business may be tight, and also a look at the long term availability of cash.
A cash flow projection is a plan that shows you how and when your income goes into your bank account. It also accounts for all outgoings from the bank account. A well prepared cashflow forecast will show the relationships between income and outgoings, which helps you as a business to plan ahead.
Clients always ask us "Where have all the profits gone? It's not in my bank account." The answer lies within the cashflow of the business. The profits may have paid off debt, be lying in receivables or taken as owner drawings.