Cash Flow Forecast

Brian D
Brian D Registered Posts: 15 New contributor 🐸
I work for a Charity in London. My Finance Manager takes the opening cash books balances of all our bank accounts as per the ledger which I agree. Then that opening balance is split between restricted and unrestricted funds. He took the figures directly from the closing balances (which will be the opening balances) of Funds as per our statutory accounts ie the balances of our restricted projects and unrestricted funds (movement in Net Funds). Would this be correct?



  • MattW
    MattW Registered Posts: 40 Regular contributor ⭐
    I also work for a Charity in London – Hi!

    If I’m reading your question correctly I’m assuming you’re asking whether that’s a correct starting position for a Cash Flow Forecast – if so then yes, your Finance Manager needs to split the cash balances into restricted (can only be spent per Donor wishes – i.e. a piece of equipment) and unrestricted can be spent on anything else.

    I guess your FM will do a cash flow forecast for unrestricted funds – op costs, staff, charitable expenditure, income generation (fundraising) and have a separate section for Restricted fund spending. Are you a small or large charity and do you specialise in making Grants -> this is just out of interest for me, smaller and non-grant making charities tend to build up restricted funds for a “project” and then spend it when they have enough, where as larger and grant making tend to do the spending and then do the fundraising afterwards & adjust their accounting reserves between restricted/unrestricted afterwards!

  • Brian D
    Brian D Registered Posts: 15 New contributor 🐸
    I work for a small charity £3m turnover.

    I asked because I thought it was odd to take the opening balances of the reserves (Unrestricted & Restricted) at the end of the year as being the opening cash balance.

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