List the commitments before adding the forecast
Start with unrestricted cash available for the period. List confirmed supplier due dates, payroll, rent, equipment payments and tax commitments. Record expected customer receipts with their likely collection dates, separating firm remittances from estimates. Keep a purchase order distinct from a paid invoice so committed outflows are visible without duplicating the actual payment when it arrives.
Illustrative example: a six-week purchasing window
A Winnipeg supplier begins with $52,000 and expects $31,000 of customer receipts. Planned outflows are $46,000 for stock, $18,000 for payroll and operating costs, and $7,000 for other confirmed commitments. Expected closing cash is $12,000: $52,000 plus $31,000 less $71,000. Against a chosen $20,000 cushion, the gap is $8,000. These are original planning assumptions, not a typical industry budget or a lending recommendation.
Test the decision that can actually change
Suppose the supplier agrees to stage $12,000 of the stock order until after the six-week window. On the same assumptions, projected closing cash becomes $24,000, above the cushion by $4,000. That improvement depends on the supplier accepting the revised timing and the later delivery still meeting customer needs. Record the agreement and add the deferred payment to the following period; postponing it does not remove the cost. A second scenario should show what happens if a major customer pays later than expected.
Refresh the plan from the accounting evidence
CRA guidance requires businesses to keep supporting records; invoices, orders, statements and payment evidence also make this forecast more credible. At each update, replace estimates with actual receipts and payments, explain the largest differences and move unresolved items to the next review. The owner can then decide whether to stage purchases, pursue collections or discuss funding. A useful forecast ends with a dated action and responsible person, rather than an unexplained negative number. Keep financing assumptions clearly labeled and confirm availability before treating borrowed funds as cash the business can spend.
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Sources and current guidance
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