Any company constantly receives and expends funds. The company must plan revenue and expenditure of funds in order to avoid shortages and possible loss for late payment of liabilities. We’ll talk about the specific features of the cash flow calendar today.
Cash flow definition.
Let’s consider what is cashflow. Cash flow is the revenue and expenditure of money funds of the company for a certain period.
Calendar of cash flow of the company is a cash flow report that contains a plan of revenue and expenditure of cash of the company indicating the date of such revenue or expenditure.
Company calendar of cash flow or project cash flow calendar consists of funds revenue calendar and funds expenses calendar.
Funds revenue calendar should include information about such revenues of funds:
- Repayment of receivables for sales. Revenue of funds for products sold plans on the scheduled dates specified in contracts with customers.
- Advances received. If a company uses a prepaid scheme, the money for the products will be received before its implementation.
- Credits receiving. If a company plans to obtain credits, such credits should be provided in funds revenue calendar.
- Other funds inflows. Financial aid, contributions from owners, obtained interests, refunds and other funds revenues may be related to this category.
Calendar of cash expenditures should include the following cash expenses:
- Expenses of funds for the acquisition of raw materials, fuel and energy. These costs can be planed under the terms of contracts with suppliers.
- Issuance of advances to suppliers. If suppliers are pre-paid under the scheme, these advances should be included in the calendar.
- Wage payments. Payment of wages can be done once or in several tranches. Dates of wages payment must be predicting in the calendar.
- Tax payments. Tax terms mainly established by laws, so it is pretty easy to predict taxes expenses in calendar.
- Credit and lease payments. If the company uses credits or lease, expenses for this purpose must be specified in calendar according to the credit or lease agreements.
- Payments of interest have to be provided on the calendar apart from the payments of the principal debt.
- Other funds expenses. Financial aids providing, payments of fines, payments to shareholders, returns of erroneously received money and other expenses belong to this category.
Calendar of money funds revenue and expenses should be based on the actual current year calendar with taking into account weekends and holidays.
Manager makes consolidated cash flow plan statement after the making of revenue and expenses calendars.
Funds balance at the beginning of the day, costs revenue and expenses per day and funds balance at the end of the day should be in a daily cash flow calendar.
Calendar report of cash flow can also be not daily, but every ten days. Daily or decades calendars are combined into monthly cash flow plan.