What do you need the liquidity forecast for?
For companies, the liquidity forecast is an indispensable strategic tool for companies. It helps to forecast and plan cash flows over a specific period, typically the next 90-360 days.
Controlling is the continuous process of planning, monitoring and managing the Cash position of a company. Through regular deviation analyses in controlling potential liquidity bottlenecks can be identified at an early stage. The target/actual comparison makes it possible to take targeted measures to ensure financial stability.
In addition, the liquidity status provides information on the company's current financial situation. It contains detailed information on available cash and cash equivalents, current receivables and liabilities as well as long-term financing structures. A forward-looking Cash flow planning, combined with effective controlling, can not only help a company to secure its solvency, but also to recognize and exploit investment opportunities. This balance is dynamic and must be continuously adapted to changes in the operating business or the macroeconomic environment.
Variance analyses in the liquidity forecast
When you create a create a liquidity forecast, it is necessary to understand the target/actual comparison approach. This form of analysis is used to determine differences between forecast and actual financial events.
By precisely identifying the causes of the deviations, companies can take proactive measures to adjust their Cash flow planning accordingly. This can mean planning incoming payments on time, better controlling expenses or rethinking financing strategies. In addition, regular variance analyses are essential to ensure that the financial health and therefore the business success of a company are presented realistically. The integration of COMMITLY into your IT landscape supports seamless variance analysis in controllingto continuously improve your cash flow forecasts.
Cash position check and monitor
The liquidity forecast as a central element of strategic financial planning is far more than just a routine task. This becomes clear when you consider how it supports companies in proactively mastering financial challenges and exploiting opportunities in the market environment. A precise and realistic liquidity forecast gives companies a clear overview of their short and medium-term financial obligations. A comprehensive overview of finances is a helpful basis for securing sufficient funds to cover ongoing operating costs, wages, bills and other necessary expenses.
This not only increases financial planning security, but also protects the company from unforeseen liquidity bottlenecks. liquidity bottlenecks which could potentially impair the operating business. A well-founded variance analysis in controlling enables forward-looking planning so that resources can be strategically calculated and investment opportunities can be optimally utilized.
Companies with a solid liquidity forecast can better recognize and exploit investment opportunities, as they know exactly when and to what extent funds are available. This enables a more efficient use of capital and strengthens the competitive position in the long term. Overestimating the available Cash position can lead to risky investment decisions. Conversely, an underestimation can lead to the company acting more cautiously than necessary and thus missing out on opportunities.
