The 13-week cash forecast is the single most useful document in a growing company's finance function. It is also one of the simplest. Here is how it works and how to keep it honest.
Why thirteen weeks
A quarter. Long enough to see a payroll crunch or a tax payment coming while you still have options — chase collections, defer a purchase, arrange a facility — and short enough that the numbers are real rather than aspirational. Beyond thirteen weeks, use the annual model.
What goes in it
The forecast is direct: actual cash in and out, by week, not accounting profit.
Opening cash — the bank balance at the start of the week
Receipts — customer collections by expected week, based on invoice dates and payment behaviour, not on when you would like to be paid
Payroll and benefits — the largest and most predictable outflow, on its real dates
Supplier payments — from the payables ageing and known commitments
Taxes, rent, loan repayments — the lumpy items that cause most surprises
Closing cash — which becomes next week's opening balance
How to keep it honest
Update it every week with actuals, and note where last week's forecast was wrong. The error pattern is the most valuable information in the document.
Forecast collections by customer behaviour. A client that pays at sixty days will pay at sixty days regardless of your terms.
Keep a "decisions" row: every hire, purchase or price change goes in as a scenario before it is approved.
Give it an owner and a fixed day. Friday afternoon works for most teams.
What it changes
Founders who run a weekly forecast stop checking the bank balance every morning. Decisions move from "can we afford this?" to "we can afford this in week nine if collections hold" — which is a much better conversation to have.
Note: Demo article for the Folistead template.
