Cash flow projection template

What is a cash flow projection?

A cash flow projection (or cash flow forecast) is the process of estimating cash in and out of the business over a specific period of time.  

The goal is to predict future cash positions to identify if you need to increase cash flow to avoid a cash shortage or if the business has cash surplus that they can earn returns off of.  

A properly prepared cash flow projection provides the business with a view of all expected funds that will be coming in and going out of the business. Knowing your projected cash flow can provide a solid basis for making business decisions.

Who can use this free cash flow projection template?

Cash flow projection templates are commonly used by businesses, entrepreneurs, financial analysts, and accountants.

Why should businesses use a cash flow projection template

The cash flow projection template is used for many different reasons, including:

1. Financial planning: A cash flow projection template helps in planning future cash flow, allowing businesses to allocate resources effectively and make informed financial decisions.

2. Identifying trends and patterns: Cash flow projection templates can help enable businesses to proactively respond to changing market conditions.

3. Risk management: By anticipating cash flow gaps or surpluses, businesses can develop contingency plans and manage financial risks. Businesses can manage their cash flow effectively to avoid cash shortages and optimize cash utilization (especially in economic uncertainty).

4. Communication with stakeholders: A projected cash flow template can help clearly communicate financial expectations and plans to stakeholders, such as investors, lenders, or internal management.

How to prepare a cash flow projection template

Here’s how to do a cash flow projection in Excel:

Step 1: Download cash flow projection Excel template.

Step 2: Estimate your monthly sources of cash.

Step 3: Estimate all your expenses each period related to company operations and overhead.

Step 4: Totals in the template will be automatically calculated.

Step 5: Verify your cash projection.

You can find more detailed instructions on how to use our cash flow projection template upon download.

Cash flow projection template FAQ

What is the purpose of a cash flow projection template?

The purpose of a cash flow projection template is to estimate future cash inflows and outflows for a business or individual, typically extending several months to several years.

By projecting your cash flow, you can prepare for any shortages, mitigate the effects of inflation, plan on investment, and generally optimize your financial planning.

What information does a cash flow projection template include?

Generally speaking, a cash flow projection includes a lot of the same information included on a cash flow statement, but for predictions of the future rather than measurement of the past.

A cash flow projection template includes information that helps you estimate the anticipated cash inflows and outflows for a specific period. The level of detail and complexity can vary based on the needs of the business or individual, but some key components in a cash flow projection template include:

• Beginning cash balance
• Cash inflows
• Cash outflows
• Net cash flow
• Ending cash balance
• Notes and assumptions

Cash flow projection vs. cash flow forecast

Cash flow projection and cash flow forecast are often used interchangeably, but can be distinguished by timeframe and level of detail. Cash flow projection templates estimate cash inflows and outflows over several months to years, taking into consideration a wider range of financial factors. Cash flow forecast templates, on the other hand, focus on the short-term (week, month, quarter) liquidity needs and opportunities.

Can this cash flow projection template be used in Google Sheets?

Yes, download our cash flow projection Excel template. Then in Google Sheets, follow these steps:

1. Create a new or open an existing spreadsheet.

2. Click File. Import.

3. Choose the Excel cash flow projection template file and click Select.

4. Choose an import location option:

• Create new spreadsheet,
• Insert new sheet(s),
• or Replace spreadsheet.

5. Click Import data and you should have this cash flow projection spreadsheet in Google Sheets.