30th May 2018

7 reasons accurate cash forecasting is important to Treasury Professionals

We’ve condensed our coveted Cash Forecasting Optimisation Playbook in to this handy list of seven reasons why accurate cash forecasting is crucial for treasury (and finance) professionals.

1. Accurate short-term forecasts allow you to access higher yield liquidity solutions

Money market funds (MMF) usually have a trading daily deadline of 12:00/13:00. As a result, if you wish to trade with them successfully, you need to be able to forecast your end-of-day position early.

2. Accurate cash forecasting means you can reduce the buffers left on account

Which means you can take those idle non-ROI balances and place the funds into profitable instruments.

3. Accurate cash forecasting allows you to plan ahead to access structured debt financing solutions

Debt financing costs are vastly reduced if you have longer term or formalised arrangements in place with your banks. Some of these options include; loan facilities, cross currency pooling and revolving credit.

4. A proactive C-Suite wants to know in advance, what cash will be available

Knowing this information could allow senior executives to make better informed operational decisions, form clear direction for the company and suggest more detailed growth strategies for the future. The bearer of this level of information can become a key advisor to the C-Suite.

5. Accurate cash forecasting is the only way to manage key treasury tasks such as FX risk

Knowing what currencies you are going to have available and when prevents making the wrong FX trades or swap deals.

6. Forecasting and review of forecasting identifies delinquent actors on both payables and receivables.

It can allow you to detect whether internal departments are making payments out of cycle, or customers are paying late, or even early.

7. Forecasting can reduce silos in the business

Corporate treasurers could minimise the requirement for external solutions and allow global pooling and inter-company lending to be maximised.


Our cash and liquidity experts, James & Winston have helped us put together a selection of strategic tactics that treasury and finance professionals can employ to get the most out of their cash forecasting process. Download the playbook below for more information.