How does a trade business build a cash flow forecast?

The rolling forecast

For each period, work out: opening cash plus receipts minus payments equals closing cash. The closing figure becomes the next period's opening figure. Business.gov.au says to update your statement regularly to spot seasonal trends and cycles, and to compare estimated with actual income and costs to find shortfalls.

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Fictional four-week table

These figures are made up for illustration. Receipts are cash you expect to land in the bank on that week's date, not invoices raised.

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Keep three things separate

Debtor receipts follow expected payment dates, so a job invoiced this week may not be cash until later. Loan drawdowns are cash in but are not profit, so show them on their own line. GST and PAYG withholding you owe should be planned as their own payments, and Business.gov.au suggests setting that money aside in a separate account.

List known payments by date: wages, super and allowances, BAS, payroll tax where it applies, licence renewals, supplier invoices, rent and loan repayments. In the example, week 4 closes at -$1,500, so you would chase an invoice, ask a supplier about terms or arrange funding before that week. Business.gov.au mentions negotiating supplier payment terms.

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Forecast layout you can copy

Use a spreadsheet or your accounting software. Some businesses plan 13 weeks ahead; choose the horizon that suits your jobs.

If payroll is entered as net payments to staff, include the withheld PAYG when it is paid to the ATO. If you start from gross wages instead, reconcile the withholding so it is not counted twice. Enter the BAS payment once, including its component taxes, rather than adding the same GST again.

CASH FLOW FORECAST
Week starting: [DD/MM/YYYY]
Opening cash: $[amount]

Cash in:
  Customer payments expected: [invoice no., customer, expected date, $amount]
  Loan drawdown or other financing: $[amount]
Total cash in: $[amount]

Cash out:
  Net wages and allowances paid to staff: $[amount]
  Employer super payments: $[amount]
  Suppliers and materials: $[amount]
  Rent, vehicles, licences, insurance: $[amount]
  BAS and other taxes due (include GST and PAYG withholding once): $[amount]
  Loan repayments: $[amount]
Total cash out: $[amount]

Closing cash: opening + cash in - cash out = $[amount]
Next week's opening cash: $[same as closing]
Actual closing cash: $[amount]   Difference: $[amount]

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Common questions

What is a 13 week cash flow forecast?

It is a rolling forecast that looks 13 weeks ahead, using the same opening cash, receipts, payments and closing cash layout. The 13 weeks is a planning choice, not a regulatory period, and you can pick a different horizon.[1]

What is the best cash flow forecasting tool?

This guide does not rank tools. Business.gov.au says most digital accounting tools can show cash flow in real time and produce reports, and that you can start from a downloadable cash flow statement template. If you have employees, check the tool supports Single Touch Payroll.[1]