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Building a cash flow forecast from expected receipts and payments
A cash forecast turns known obligations and expected collections into a forward-looking working plan. Keep assumptions visible and update them when invoices, staffing or purchase plans change.
This guide describes common bookkeeping practice, not a legal or regulatory requirement.
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General information, not legal or tax advice.
Anchor the forecast to available cash
Begin with reconciled cash and identify amounts already committed. As a practical worksheet, list opening cash, expected receipts, planned disbursements and projected closing cash by period. Preserve the starting date so later reviewers can distinguish the original plan from actual results.
Document why receipts and costs will change
SBA lending guidance requires justification for projected revenue growth and expense reductions. Tie expected collections to customers, jobs or recurring contracts, and explain uncertain dates. Keep hoped-for sales separate from committed work so the cash plan does not depend on an invisible assumption.
Match forecast detail to the funding discussion
SBA business-plan guidance requests projected income statements, balance sheets, cash flow statements and capital budgets, with quarterly or monthly detail for the first year. Explain how those projections match the funding request. Your operational worksheet may be more frequent, but it is not an official mandated template.
Sources: SBA - Plan your business
Refresh the plan against actual spending
SBA identifies recurring costs such as salaries, rent and utilities when planning expenses. Compare actual receipts and payments with the forecast and annotate the largest timing changes. Carry delayed obligations forward explicitly rather than letting them disappear when a forecast period closes.
Sources: SBA - Plan your business
Sources: anchor the forecast to available cash
Turn collection assumptions into a cash plan
Tidwell helps reconcile the books and organize supporting schedules for your business decisions. We work with your CPA on tax questions and the financial records they need.