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2019 “Cool” Winter Seminar AFP of Portland and SW Washington Cash Forecasting Workshop

2019 “Cool” Winter Seminar AFP of Portland and SW Washington Cash Forecasting Workshop. February 20, 2019.

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2019 “Cool” Winter Seminar AFP of Portland and SW Washington Cash Forecasting Workshop

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  1. 2019 “Cool” Winter SeminarAFP of Portland and SW WashingtonCash Forecasting Workshop February 20, 2019

  2. At Mercy Corps, we are powered by the belief that a better world is possible. In disaster and in hardship, in more than 40 countries around the world, we work with global and local leaders to put boldsolutions into action. Together, we are helping people triumph over adversity and build stronger communities — now, and for the future. 2 | GO BEYOND THE EXPECTED We Believe

  3. 3 | GO BEYOND THE EXPECTED • Today our staff of about 5,000 team members is reaching nearly 28 million people in more than 40 countries around the world.

  4. Cash Forecasting the Intersection of Science & Art 4 | GO BEYOND THE EXPECTED

  5. What is your definition of cash forecasting? • Cash Position • Cash vs Cash Flow • Book vs Bank Why do we cash forecast? • We have to know where we stand • Need information to make decisions • Provides reliable performance visibility 5 | GO BEYOND THE EXPECTED Cash Forecasting

  6. Considerations for your forecast • Timeframes • People • Reporting How do we prepare for cash forecasting? • Sources & uses • Regularity & spikes • Corroboration of assumptions • Designing cash control points • Consistency 6 | GO BEYOND THE EXPECTED Considerations & Preparation

  7. Bank Account Structure • Accounts for a purpose • Receipts, Disbursements, Payroll, Divisions, ERPs, etc. • Also helps with security & fraud • Zero Balanced Accounts • Products offered by the bank • Lockbox • Control disbursement • ACH • Cards 7 | GO BEYOND THE EXPECTED Design for Control & Information

  8. Do you know what your cash position is to start the day? • What came in and what went out yesterday (Reconciliation) • What do you expect to come in today and go out today (Positioning) • Who needs to know (Reporting ) 8 | GO BEYOND THE EXPECTED Start with Today

  9. Tracking Process • Daily tracking corresponds to how you forecast and position • Follow the flow of your bank reports • Proper level of detail • Best place to use your treasury workstation • Tie it out! 9 | GO BEYOND THE EXPECTED Design for Ease

  10. Building the Forecast • Know what you are solving for (cash, debt, investments, liquidity) • Dual templates – forecast and actuals • Build up daily • Daily tracking corresponds to how you forecast and position • History is your best guide for tomorrow • Work your sources (tax, divisions, AP/AR, payroll, procurement) • Accuracy, check formulas • Variance analysis 10 | GO BEYOND THE EXPECTED Organize the Data

  11. Don’t keep it a secret Publish or perish Know your audience • Visual or number oriented • Level of detail Accuracy counts • Tick and tie the same number across multiple reports and multiple time frames Give it context Consistency – set expectations 11 | GO BEYOND THE EXPECTED Report

  12. 12 | GO BEYOND THE EXPECTED Cash Forecast

  13. 13 | GO BEYOND THE EXPECTED Liquidity Metric

  14. Thank You

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