Cash Flow Forecast Model

1. Workbook structure

• · Tab 1 — Assumptions: pricing, volume, growth rate, collection days, payment terms
• · Tab 2 — Revenue build: units × price by product line, with seasonality multipliers
• · Tab 3 — Direct costs: cost of goods sold by line and gross margin
• · Tab 4 — Operating expenses: fixed and variable, monthly
• · Tab 5 — Payroll: gross wages, CPP, EI, EHT, WSIB, vacation accrual
• · Tab 6 — Cash flow statement: opening cash, inflows, outflows, closing cash, runway
• · Tab 7 — Scenarios: base, downside (−25% revenue), upside (+25% revenue)
• · Tab 8 — Variance: forecast vs actual by month with a comment column

2. Cash timing rules that trip up Ontario businesses

• · HST collected is not revenue. Move it to a separate liability line and, ideally, a separate bank account
• · HST filing frequency depends on revenue: annual, quarterly or monthly. Diarize the filing and payment date and forecast the payment as a cash outflow
• · Input tax credits reduce the remittance — track HST paid on purchases in the same period
• · Payroll source deductions (CPP, EI, income tax) are generally due by the 15th of the month following the pay
• · Ontario Employer Health Tax applies once your Ontario payroll exceeds the exemption threshold — confirm the current exemption on Ontario.ca
• · WSIB premiums are reported and paid on your assigned schedule based on insurable earnings
• · Corporate income tax instalments may be required monthly or quarterly

3. Core formulas

4. Scenario planning

• · Downside: revenue −25%, collection days +15, no new hires — does runway stay above three months?
• · Base: current trend continued with known price changes
• · Upside: +25% revenue — model the working capital needed to fund inventory and payroll before cash arrives
• · Stress test one event: lost key client, equipment failure, rent increase, seasonal shutdown

5. Monthly close routine

• · Reconcile every bank and credit card account
• · Enter actuals beside forecast and write one sentence explaining each variance over 10%
• · Roll the forecast forward one month so you always hold 12 months of view
• · Confirm HST, payroll, EHT and WSIB obligations for the coming month are funded
• · Review aged receivables and act on anything past 30 days