Build a 13-week cash forecast

Direct answer

A 13-week cash forecast shows available opening cash, expected receipts, planned payments, and closing cash for each week. Start with reconciled balances, date the major receipts and payments, and compare each completed week with the prior forecast.

Why this question comes up

An annual or monthly budget can miss a week when payments are due before collections arrive. A weekly view makes that gap visible early enough to review options.

Records to gather

• Reconciled opening cash by account, excluding cash unavailable for operations
• Open A/R with customer-level payment history, not just terms
• Open A/P with due dates and any supplier arrangements
• Payroll calendar including tax deposit dates and any 3-payroll months
• Debt service schedule and recurring transfers
• Known one-offs: tax payments, insurance renewals, deposits, capex

Review workflow

1. Use consistent week boundaries. Show 13 consecutive weeks and the opening and closing balance for each. Check daily timing separately if a within-week shortfall matters.
2. Start with available cash. Reconcile opening balances and identify restricted funds or transfers between accounts so they are not counted twice.
3. Date receipts realistically. Use invoice terms alongside customer payment history, confirmed payment dates, and disputed balances. Mark uncertain collections rather than assuming all invoices arrive on their due dates.
4. Date outflows. Place payroll, payroll taxes, debt service, supplier payments, and one-offs in the weeks they are expected to clear. Check the actual payroll calendar rather than a monthly average.
5. Roll forward each week. Replace the completed week’s forecast with actual cash movements, note the differences, and add a new week at the end.
6. Review recurring misses. If receipts or payments repeatedly fall in different weeks from forecast, update the timing assumption and retain the old version for comparison.

What a useful answer should include

• Weekly opening balance, receipts, disbursements, and closing balance
• The lowest projected balance across the 13 weeks and the week it occurs
• Collection timing based on observed customer behaviour, with the assumption stated
• Payroll, tax, and debt service on their actual dates
• A variance column comparing the prior week’s forecast with what happened
• Explicit flags on any week projected below the operating minimum or a covenant floor

Common failure modes

• Relying on month-end cash alone. A positive month-end balance can hide a shortfall earlier in the month.
• Treating invoice due dates as certain receipts. Payment history, disputes, and confirmed dates may point to different weeks.
• Skipping forecast-to-actual review. Without it, repeated timing errors remain in the next version.
• Averaging payroll by month. Use the actual payroll dates; some months contain more pay runs than others.
• Counting unavailable cash. Restricted funds or transfers between accounts can overstate what can pay bills.