Record room · 10 June 2026 · 1 min read
Five forecast assumptions a funding file should state plainly
A cash-flow forecast becomes inspectable when its volumes, timing and financing assumptions can be traced.
A forecast is not strengthened by hiding uncertainty. It becomes more useful when a reviewer can see how sales, margins, collections, purchases and debt payments were constructed.
Sales volume and price
Separate expected units from selling price. State whether growth comes from signed orders, current capacity, a new contract or management judgement. Where one customer drives the increase, identify the concentration without disclosing unnecessary personal details.
Collection timing
Revenue is not cash on the invoice date. Show the collection pattern supported by the debtor age analysis and note any overdue account treated differently.
Gross margin and purchasing
Explain whether input costs follow historical margins, supplier quotations or anticipated volume discounts. Seasonal inventory purchases should appear before the related sales.
Existing and proposed debt
Include current instalments, balloon payments, interest assumptions and the proposed facility’s drawdown date. Avoid presenting the new funding as cash while omitting its repayment.
Tax and owner movements
State VAT, provisional tax, dividends, drawings and shareholder-loan changes. These lines often explain why a profitable forecast can still experience a cash shortfall.