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Cash Forecasting During an Unstable Economy

Covid-19 has turned the world’s economies upside down.  As preventative measures (such as lock-downs) continue, uncertainty abounds.  This uncertainty is making it difficult for companies to gain a clear picture of their finances.

In the best of times, when the financial waters are calm and the visibility is clear, cash forecasting remains one of the greatest challenges for a company (with most admitting to a level of accuracy that barely approaches 75 percent).  So now, when there is turmoil across of levels of the spectrum, what can companies do to ensure that their forecasts stay afloat?

Intelligent organizations utilize events (be it a downtown in the market, a merger/acquisition for your company, etc.) as opportunities to step back and analyze the entire landscape.  It is only during such analysis that improvements can be identified and resolutions can, in turn, be implemented.  All related processes should be examined from start to finish.  This is always a difficult task in relation to forecasting as there are so many moving pieces, which is why organizations struggle to forecast accurately; however, there are indeed measures that can be taken to add much value to this process.

  1. Thoroughly define your forecasting criteria:
    • What is the timeline of the forecast?  For example a 13-week rolling forecast is commonly adopted among corporations, as it is not too long term and its periodicity (weekly) is not to granular nor broad.
    • What entities should be included in the forecast (is it local, regional, global)?
    • What type of financial data should be included: everything or only certain types of activity?
  2. What sources own the financial data and how should the data be extracted?
  3. What tool or tools should be utilized to centralize the data and compute the necessary analytics?
  4. What specific analytics should be performed? What modeling scenarios should be computed?

Once a company has implemented a thorough forecasting process, it remains important to continually update the relevant data points.  During the pandemic, all previous modelling scenarios should be reconsidered and adjusted accordingly.  Data sources should be revisited (as employees, now working from a remote location may no longer have access to all necessary data).  Furthermore, the current situation has made forecasting tools a critical part of this process.  Cash Management systems, such as Kyriba, can connect to external financial systems to centralize the forecasting data and conduct powerful analytics toward building multi-level accurate forecasts.


Contact Perficient to learn more about how to leverage Kyriba’s TMS software to improve your organization’s forecast today.

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Ben Jacoby

With nearly 20 years of Treasury and Treasury Workstation experience, Ben is a consulting expert in the field with a specialization in Kyriba’s offerings. He worked directly for Kyriba from 2003 until 2016, holding various roles, including Implementation Manager and Product Manager. Ben has supported over 100 successful implementations with project lifecycle knowledge from sales and design to implementation and go-live. Since leaving Kyriba, Ben has led implementation teams for Horn Solutions and ERP Logic projects, both based in Texas. We welcome Ben to Perficient, where he will be an integral team member, building our strategic partnership with Kyriba.

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