Financial Management

Cash/Fund Flow

Cash Flow Forecasting:  This is basically a document that needs to be prepared at the organization level for each programme of the overall project.  When you plan to start a particular activity of a project, you need to give a cash flow forecasting (see cash flow forecasting in Grant Management Whether the donor release the payments on Quarterly Basis or Six monthly basis or Yearly Basis,  we need to do the planning  on a Monthly Basis. (see the Cash Flow Forecasting sheet in the Grant Management Section. For this first of all we need to have Project Programme Sheet for the whole year where you will have details of what programme will take place in which month etc. see Programme Planning Sheet in the Grant Management section.

a)As per this sheet you will see that all the project budget is given in the first column against each budget head.  You need to split it into the number of months as per the project period. i.e. if the project is for one year and is approved from January, then you need to have the columns for January to December.

b) as per the Programme Planning Sheet, you will know what programmes are to take place in which month.  So accordingly you need to put the amount required for a particular activity that is going to take place in that particular month.

c) In case of Capital Items since they are of one time purchases as per your needs you should put that whole amount in that particular month.

d) Salaries and other expenses needs to split into the number of months.  

e) Calculate the monthly expense for the over all project  and as per the funding agency needs you forecast the budget for either quarterly or six monthly or yearly.

f) The other important thing that  you need to look into is the time it takes to get the funds transferred to your account.  Accordingly you need to request for funds in advance.  

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