If You Can Keep Your Head...

03.02.26 08:28 AM

Written by Johnny Kipps

Article based on the poem 'IF' by Rudyard Kipling*

You can, with Forecast 5!

The bad news is almost deafening, gilt yields up, the Chancellor being hung out to dry, expectation of more tax hikes in the coming budget, business confidence down; the pound falling, possible IMF intervention - and so it goes on.

Negativity follows pessimism follows negativity.

🧠When all about you are losing theirs.....

When doom and gloom abounds, it's really important to secure your business financial base, with robust, accurate, fast cashflow forecasting. 

🛡️If you can:

Quickly produce a suite of forecast reports that includes a Cashflow report, a Profit and Loss, Balance Sheet and tying them all together, a Funds Flow report (think Statement of Cashflows)* – for as many years into the future as you may conceivably need;

Integrate with accounting or ERP of your choice – Xero, Sage50, Sage200, SAP Business 1, enabling quick production of
Variance Analysis and Rolling Forecasts, showing where your business is moving away from budget – hopefully favourably, (but also the adverse variances😢) and after re-forecasting any lines of your trade where necessary, quickly show the expected position going forward to the end of the financial year;
Run as many What if scenarios as you require, modelling expected changes producing “decision ready information” to support in-flight changes in your business direction;
Carefully and realistically model staff cost – which in some labour intensive businesses may exceed 50% of turnover – based on full UK tax and National Insurance rates and pension provisions – and review via a detailed Employment Schedule, showing all employees (or bands of employees), including a summary of full liability to HMRC and pension third parties (i.e. providing a full audit trail);
Fully model your manufacturing and WIP costs, including opening and closing stock and sell from from stock, keeping track of COGS and remaining stock values;
In a group situation, consolidate all subs, eliminating intercompany profits and losses and inter-co loans, adjusting for minority or associate holdings and goodwill, including goodwill impairment where necessary;
“Going Concern” assessments with full and straightforward traceability back to all underlying data, a process absolutely imperative for company Boards and their Auditors to get right;

Most of the above is just not possible with spreadsheets: Spreadsheets cannot provide this level of flexibility. Spreadsheet budgets lack the ability and ease required to quickly produce a complex budget that meet various departments needs, to consolidate multiple entities for an accurate cashflow overview, and to reflect what-if scenarios. And spreadsheets are notoriously error-prone– even the ICAEW admits this; and

If you are really think it’s a good idea to budget with spreadsheets, do spend a few minutes first reviewing the list of horror stories highlighted in the European Spreadsheet Risks Interest Group website?

👥If all men count with you…..

There is only one budgeting and forecasting programme available that can deliver all these benefits

helping to keep you sane in a fast changing world - that is Forecast 5.

Faster Forecasts. Fewer Errors. One Trusted Platform.

See the difference in just 21 days!

Start your free trial or request a demo to experience smarter forecasting

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* The Funds Flow statement plays a vital part in proving the overall integrity of the model. The Profit & Loss matches to the Cashflow and the Balance Sheet which matches to the Funds Flow. This allows you to not only to confirm that your model is in balance, also to see what you are spending and where the profit has gone.

*Listen to the full version of the world famous *IF by Rudyard Kipling, The Nobel Prize in Literature (1907) and The BBC's National Poem Poll (1996)