13 Week Cash Flow Report » Overview

Purpose of The 13 Week Cash Flow Report

Use the 13-Week Cash Flow Report to forecast the cash flow needs of a company. This tool is especially useful when entering a situation where active cash management is required. In essence, the report is a sources and uses of cash using the direct method vs the indirect method normally used in GAAP.

The 13-Week Cash Flow Report is used best as a “big picture” tool to see how much cash is required on a forward rolling basis.

Having a clear sense of your working capital needs and when you need it gives added impetus to collect cash and/or to generate revenue.

Because of the work involved, you don’t want to prepare this report unless you have to. Most companies have sufficient liquidity so that the benefit of generating the report doesn’t usually outweigh the cost to prepare. Use this report in either a high growth company that is outstripping its ability to internally generate cash or in a distressed company that has consumed its equity cushion.

Why 13 weeks? The reason is that there are 13 weeks in a ninety day period. Another way to look at is that the 13-week rolling cash flow projection is a three month projection.

This tool is also helpful when used in conjunction with the daily cash report. It is helpful to think of the 13- Week Cash Flow report as giving you the strategic big picture needs, while the Daily Cash Flow Report provides a more tactical level measure of a firm’s cash position.

There are several key areas of information that you will need to obtain information on:

• Beginning Cash Balance
• Est. Cash Receipts – A/R
• Est. Payroll & Taxes
• Est. Operating Expenses
• Note/Lease Payments
• Payments on LOC-ML
• Payments- A/P

Frequency of 13-Week Cash Flow Report

Use the 13-Week Cash Flow Report in the active cash management of the company. Update this tool and review it on a weekly basis. Since the report is based on projections, focus on the big picture items. The goal is to prevent the company from running out of cash. It should give you a heads up for corrective action in order to give you time to react.

Delegate this report to a clerk or accounting to accumulate the information. The CFO or Controller should set up the report and review the results before presenting to management.

13-Week Cash Flow Report Template

Click to download: 13-Week Cash Flow Report