An important part of cash management for any business is knowing how much money will be flowing in or out of any bank account at any given time. This visibility provides the ability for better cash management and avoids future financial obligations. Cash flow forecasting gives businesses the ability to make smarter decisions with their funds. The benefits of cash flow forecasting are the ability to lower borrowing cost and increase investment opportunities..
The forecast has other insightful benefits that allow businesses to optimize their cash and operate at maximum efficiency by being able to adopt short term funding measure where necessary. Knowing accounts that have a surplus and those that have a deficit ahead of time allow treasury departments to move money internally without having to borrow the funds. Having this knowledge also helps with securing lines of credit and facilities in advance of any future unknowns.