What is a 13-week cash flow forecast?

A week-by-week list of expected cash receipts and payments for the next quarter, ending in a closing cash balance for each week.

It is one quarter: far enough ahead to act on a problem, close enough that receipts and payments can be estimated with some confidence.

How is it different from a profit and loss account?

It tracks when cash moves, not when revenue or cost is recognised. A profitable business can still run short of cash.

What should I stress test first?

Customer payment delays and lower receipts. In the fictional example, a 2-week delay with 15% lower receipts breaches the buffer in week 4.

13-week cash flow forecast: a worked example for founders and finance managers

If you run a company, sit on a board or manage the finance function, profit is not the number that decides whether you can pay people next month. Cash is. A 13-week forecast is the simplest way to see the gap between the two while there is still time to act.

What goes in the forecast

Opening cash: what is in the bank on day one.
Receipts by week: when customers will actually pay, not when you invoice. Use your real payment history.
Known payments by week: payroll, suppliers, rent, loan repayments, and tax and VAT dates you already know.
Closing cash by week: opening cash plus receipts minus payments, carried into the next week.
A minimum cash buffer: the figure below which you are uncomfortable, such as one payroll run.

A fictional worked example

Take a small company that starts with £35,000 in the bank. In the base case, receipts arrive when expected. Closing cash dips to a low of £7,800 and ends week 13 at £9,200. That is tight but workable.

Now stress it. Customers pay 2 weeks later than planned, and total receipts come in 15% lower. Nothing else changes. The same business ends week 13 at -£42,550, a swing of £51,750 against the base case. The cash buffer is first breached in week 4, long before the quarter ends.

What the stress test tells you

The risk is timing as much as size. A delay of 2 weeks hurts early, which is why the breach is in week 4 and not week 13.
The date of the first breach is the useful output. It is the deadline for your decision.
A base case that looks fine can hide a failing stress case. Run both before you commit to spending.

Levers to test when the buffer breaks

Chase or invoice earlier, and move big customers to shorter terms.
Delay discretionary spend, or ask suppliers for longer terms.
Stage hiring or capital purchases behind confirmed receipts.
Arrange a facility before you need it, because lenders prefer to hear early.

Change one lever at a time and watch the first breach week move. If it does not move, that lever is not the fix.

How often to update

Roll the forecast forward weekly: replace last week's estimates with actuals, then add a new week 13. That keeps it a decision tool rather than a one-off report.

General information, not financial, tax or legal advice. The example is fictional. If you may be unable to pay debts as they fall due, take professional advice.

A template for this

Practical Finance has built an editable 13-week Excel forecast with a fictional worked example, a blank workbook, a delayed-payment stress test and a cash-buffer dashboard. This article promotes a Practical Finance tool.