Forecasting cash flow

a CEO master skill

An integrated spreadsheet that links a business' projected balance sheet and income statement is a powerful tool that can enable a CEO to project and adjust cash flow, pace capital expenditures, and direct investment. This article describes how to create such a tool using popular database software and use it to perform 'what if' analyses and other valuable forecasts. Once the integrated spreadsheet is set up, actuals from financial statements can be entered into it on a monthly basis, and the tool can then be used to develop a financial plan that optimizes working capital or projects negative or positive cash flow. Beyond the obvious benefits of the tool, it also can help the user to think about every aspect of the business in new ways.
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