Quickbooks Cash Flow Forecast Planner Tool

The invention of QuickBooks is a boon for small and medium-sized businesses. This accounting application helps to manage the functions by keeping records of a business. The amount of money that moves in and out of the business bank account should be tracked. For the growth of the company, a forecast of the financial records should be maintained to prevent money trouble in the future. So, in today’s blog, you will learn the importance of Quickbooks cash flow forecast and how we use QuickBooks online cash flow forecast in businesses.

What is a Quickbooks Cash Flow Forecast?

Cash flow refers to in or out payments that are mainly used in a business. The money collected from sales etc., and adds profit to your business is known as cash inflow Whereas, the company’s expenses are called cash outflow, such as debts and operating costs. When the cash level of a company is estimated to know its financial status, this process is known as cash flow forecasting. Intuit provides a feature to forecast the cash flow using the Quickbooks cash flow forecast tool. Intuit cash flow is available in both desktop and online versions.

Types of Cash Flow

Investing Cash Flow: When the amount spent on fixed assets has economic value. For instance, vehicles, machinery, and furniture. Selling these belongings to make cash inflow is known as investing cash flow.
Operating Cash Flow: This cash flow is the amount of cash that generates revenue from core business activities like sales profit etc. You can calculate this by subtracting cash generated by customers from the amount of money paid to suppliers.
Financing Cash Flow: It is a company’s financial statement that shows the inflow and outflow of cash. For instance, equity or debt is categorized as financing cash flow.

Why is the QuickBooks Cash Flow Forecast Important?

Cash flow shows the inflow and outflow of money in your bank. Its forecasting is important to prevent negative cash flow. For the growth of the company, positive cash flow is important. So, it helps to track business income and expenses.

Process of Cash Flow Forecast in QuickBooks

Cash flow forecast helps to set up short-term and long-term goals to manage financial data for the company. Forecasting of Cash Flow in the QB can be done in two ways:-

Creating and Managing Forecasting in Quickbooks Online

You can add Quickbooks cash flow forecast in online mode by following these steps:

Create a Forecast

It can be created at any time, however, if you want to plan for next year then a forecast should be created at the end of the year. This feature is available only for those who have a QuickBooks Online Advance subscription or else you can upgrade it.

Step 1:- Analyze the Financial Year of the Business

The beginning of the fiscal year should be set in your QuickBooks, you can do this by following these simple steps:-

First, sign in to your QB online account.
Now click “Settings” and then select “Account and Settings”.
Press the “Advanced” tab.
Review the “First month of the fiscal year” from the Accounting section. You can make changes by clicking on the “Edit” if you have entered the wrong year.
After selecting the month, save it by clicking on “Save”.

Step 2:- Enter Your Forecast Data

If you have entered your data before then you can skip this step else enter your data the year before or the accounting year. If you want to use your old or historical data run a “Profit and Loss Detail” report. If you want to make any changes click customize the report option mentioned in the last section.

Step 3:- Create a Forecast

The forecast accounts list is created in QB online based on your chart of accounts. You can add multiple accounts before creating the forecast. Now follow these steps:-

Click on “Financial Planning” and then select “Forecast”.
Now click on “Create Forecast”.
Select the time frame for your forecast from the “Forecast for” dropdown.
Now select the following forecast methods from the “Forecast using” dropdown.

a) Average of actuals

b) Actuals from the last financial year

The forecast method and duration can be customized until you save the first time from the settings.

After selecting “Average of actuals”, select the old actual duration to calculate the average from the “Use Actuals from” dropdown menu.
Set rules can be added from the Set Rules section.
Click on the “Next”.
You can edit the name of your forecast by clicking on the option “Edit”.
Now save by selecting “Save and close”.

Edit a Forecast

You can make changes in QB by following these steps:-

Click the “Financial planning” tab then go to “Forecast”.
Now you can find your forecast from the list and click “View/Edit” from the Action column.
Save changes you have made by clicking “Save” or “Save and Close”. (By clicking on “Refresh actuals”, you can refresh the forecast with the latest actuals)

How Forecast Can Convert into a Budget?

Here the first two steps are the same as Edit a Forecast.

Select “Financial planning” then click on “Forecast”.
After finding your forecast on the list, select “View/Edit” from the Action column.
Now choose the fiscal year of the budget and select the option “Make this a budget”.
Again select “Make this a budget” to save the forecast as a new budget. You can create a budget in QB online.

Delete a Quickbooks Cash Flow Forecast

Follow these simple steps to delete the forecast:

Firstly, select “Financial planning” and then “Forecast”.
Now find your forecast from the list then click on the “View/Edit” dropdown from the Action column.
After selecting “View/Edit” click on “Delete”.

Customize a Report

Follow these steps to customize the Quickbooks cash flow forecast report:

Select “Reports”.
Now find and select the “Profit and Loss Detail Report”.
Select a timeframe from the “Report period” dropdown. If you want data from the previous year click on the “Last year” option and for the current year, select “This Year-to-date”.
Click on “Run report”.
Click on the “Print or export” icon to download and print, or if you do not want to reopen the report.

Quickbooks Cash Flow Planner

Quickbooks cash flow forecast uses a planner tool to check the amount of cash inflow and outflow. It tracks the financial history like income and expenses. Some steps will help you set up a QBO cash flow planner:

Step 1:- How to Set Up Account

You can set up your planner by using your data from your accounts in QB.

Step 2:- How to Add New Item

To know income and expenses, you can manually add items like transactions. (Items are not actual transactions, so QB will not add them)

Select “Dashboard” and then go to “Planner”.
Click on “Add Transaction”.
Now, if the item is income select “Money in” and if it is an expense click on “Money out”.
Provide a name to the item and also enter the amount.
After completing, select “Save”. You can export your cash flow details by clicking “Export as PDF”.

How to Edit or Delete An Item

You can make changes to your Quickbooks cash flow display.

(Your books will not be affected by making any changes. It will facilitate when to spend, borrow, transfer, and save)

Edit an Item

First, click “Dashboard” then go to “Planner”
Then make changes by selecting the item to edit.
Now change the name, amount field, money in or out, and date, or else repeat the details.
Click on “Update”.

Delete an Item

Go to “Dashboard” and then click “Planner”
Now select the item to make it delete.
Click “Remove”(To delete a single item in the series, click “Only item” and to delete all repeating items, select “Entire series”)

How to Customize Your Qbo Cash Flow Planner

You can customize your planner by selecting the data you want in your business.

Start by clicking “Dashboards” and then click on “Planner”.
Now select the “small gear” icon.
You can choose your preference.

Select accounts from the Linked Account section and it will show in the cash balance and money-in and money-out chart. If an account is not listed click the “plus +” icon.
You can choose QB transaction types from the QB section.
You can keep a cash reserve of a specific amount handy. This can be visualized on the chart of your cash threshold which can be seen in the Threshold section,

Click on “Save”.

Conclusion

By reading this blog, you know how a cash flow planner is a useful tool and helpful for forecasting your recurring business income and expenses. Quickbooks Cash Flow Forecast tool was beneficial to your business for growth.

Forecasting cash flow in Quickbooks makes it easy to evaluate inflow and outflow. In this blog, every detail regarding cash flow forecasting in QuickBooks is explained in easy steps that can be easily followed. If you’re stuck in any step then contact Quickbooks Payroll Support. Their experts will professionally guide you.

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