Free Cash Flow Forecaster

Cash flow is the money that moves into and out of a business over a period. Cash in is receipts such as customer payments. Cash out is payments such as suppliers, rent, wages and tax. The difference is net cash flow. Add that difference to the cash you hold at the start, and you have the cash you hold at the end.

Cash is the balance in the bank and in the till, not the value of unsold stock and not an invoice that has not been paid. A sale on 60-day terms is income in the books when you raise the bill. It is cash only when the money arrives.

A short forecast, such as 30, 60 or 90 days, asks a practical question: will there be enough cash to meet the payments that fall due in that window?

Bills are paid in cash. Wages, rent, GST and suppliers do not wait because last month's sales looked strong on paper. A business can show a profit and still miss a payment if the cash has not arrived.

Cash flow also sets how much you can buy, hire or hold in stock without borrowing. A thin closing balance means a late customer or an early supplier bill can push the account below zero. A surplus means you can take a discount for early payment, or wait out a slow week, without stopping operations.

Owners who look only at sales miss the dates. Two businesses with the same monthly turnover can have different cash paths if one collects in seven days and the other in 45, or if one pays suppliers on delivery and the other on 30-day terms.

Profit is income minus expenses in the accounts. Cash flow is money received minus money paid. They meet only when every sale is collected at once and every cost is paid at once. Credit sales, stock, depreciation and loan principal drive them apart.

A shop can sell ₹2 lakh of goods at a profit and still run short if those invoices are unpaid while rent and wages leave the account this week. The reverse is also true: collecting old dues can fill the bank while the month's profit is modest.

Accounts split cash movement into three groups. A 30, 60 or 90 day working forecast usually starts with operating items. Investing and financing still belong in the same window if a machine, a loan draw or a repayment falls inside it.

A cash flow forecast estimates future cash by lining up expected receipts and payments on the dates they are likely to occur. It starts from opening cash, adds each inflow on its date, subtracts each outflow on its date, and carries the running balance forward.

The horizon can be 30, 60 or 90 days. Shorter windows suit bills you can already name. Longer windows show whether a surplus in week one is still there after a tax date, a stock order or a slow collection in week eight.

The forecast is only as good as the dates. Putting every receipt on day one and every payment on day 30 hides a mid-period gap. The chart on this page follows the dates you enter, so a supplier bill before a customer payment will show as a dip even if the period ends in surplus.

To forecast cash flow for the next 30, 60 or 90 days:

1. Write down the cash actually in the bank and till today. That is the opening balance.
2. Choose the period: 30 days for the next month, 60 or 90 if later bills and receipts matter.
3. List expected income with a date and an amount: collections, cash sales and other receipts.
4. List expected expenses with a date and an amount: suppliers, rent, wages, tax and other payments.
5. Add income, subtract expenses, and read the projected closing balance and the net cash flow. Check any day the running balance falls below zero.

On this page, add as many income and expense rows as you need, then select Calculate Forecast. Rows dated after the chosen window are left out. Undated rows are treated as falling at the start of the period.

Net cash flow = cash in − cash out.

Projected closing balance = opening cash + cash in − cash out.

Cash in is the total of expected receipts in the period. Cash out is the total of expected payments. If opening cash is ₹80,000, receipts are ₹1,20,000 and payments are ₹95,000, net cash flow is ₹25,000 and the projected closing balance is ₹1,05,000.

Closing cash can stay positive while net cash flow is negative, if the opening balance covers the gap. Opening ₹2,00,000, receipts ₹40,000 and payments ₹90,000 leave a net outflow of ₹50,000 and a closing balance of ₹1,50,000. The business is still using cash. It is not yet out of cash.

• Treating booked sales as cash. An unpaid invoice is not a receipt until it clears.
• Ignoring dates. A surplus at month-end can hide a gap in week two if wages go out before collections come in.
• Leaving owner drawings, loan EMIs or tax out of the payment list. They leave the account whether or not they appear on a sales report.
• Buying stock from a strong week of sales without checking the next payroll date.
• Using last month's totals as this month's forecast when a large customer or a festival week will not repeat.

A further mistake is to forecast only 30 days when a GST date, a term-loan EMI or a seasonal purchase sits in day 40. Extend the window rather than assume the later payment will look after itself.

• You see whether opening cash plus expected receipts will cover the payments that fall due.
• You can move a non-essential purchase, or chase a named invoice, before the account runs short.
• You can compare 30, 60 and 90 days and notice a problem that does not appear in the first month.
• You separate a profitable month from a cash-tight month, which are not the same condition.

The benefit is timing, not a new profit figure. A forecast will not make a weak collection cycle strong. It will show the week in which that cycle becomes a problem.

This page estimates one 30, 60 or 90 day window from figures you type. ZemERP is cloud ERP for billing, inventory, accounting, GST, CRM, HRMS and payroll in one login, so those figures are not retyped from separate sheets each time a bill or a receipt changes.

Invoices, collections, purchases and expenses sit in the same organisation. A payment recorded against a customer invoice updates what is still due. A purchase bill updates what you owe. Payroll and GST stay with the same books rather than in a side file that the forecast never sees.

Use the free forecaster to test a 30, 60 or 90 day view. Use ZemERP when receipts, payments and stock need to stay in one record so the next forecast is not built from memory.

• Collect on the date you agreed. Follow up invoices before the due date, not after the account is empty.
• Match purchase dates to expected receipts. Do not restock from a sale that has not been paid.
• Keep a reserve that can cover at least a short period of wages and rent if one customer pays late.
• Put GST, EMI and owner drawings on the same list as suppliers. They are cash out, not optional notes.
• Re-run the 30, 60 and 90 day view when a large order, a delay or a new rent figure appears.

Positive cash flow means receipts exceed payments in the period. It is maintained by dates as much as by prices. A sound margin still needs the money to arrive before the bills that the margin is supposed to cover.