Cash Forecasting
Cash Forecasting enables you to make effective use of funds. It is a planning tool that you can use to anticipate the flow of cash in and out of your business. Cash forecasting enables you to project your cash needs and evaluate your company's liquidity position.
Oracle Cash Management allows you to access information related to the anticipated cash flow from other feeder systems, such as Oracle Payables, Oracle Receivables, and Oracle Payroll. This enables you to prepare cash forecasts and determine currency exposures.
You need to create forecasting templates in Oracle Cash Management. These templates are reusable and enable you to prepare cash forecasts in any currency format.
The start point for preparing the cash forecast using Oracle Cash Management is the known cash position. This figure is available after you complete the reconciliation process. Oracle Cash Management forecasts the cash position for any future time period using historical and future transactions. Historical transactions include payments and receipts. Future transactions include orders and invoices.
Creating Cash Forecast Templates
Before creating cash forecasts, you need to define the cash forecast templates that contain the cash forecast specifications. A template is similar to a spreadsheet and contains rows and columns.
Rows define the sources of cash inflow and outflow. Columns specify forecast periods.
To create a Cash Forecast Template:
Open the Forecast Template window by selecting Cash Forecasting->Forecast Templates. Screenshot shows the Find Forecast Templates window:
The Find Forecast Templates Window
Click the New button to navigate to the Forecast Templates window. Screenshot shows the Forecast Templates window:
The Forecast Templates Window
In the Name field, type a name for your template.
In the Forecast By field, select the Days or the GL Periods option.
In the Overdue Transactions field, select Exclude to specify that you want to exclude open transactions that have a cash activity date before the forecast date. Alternatively, if you want to include the open transactions, select Include.
Note
Overdue transactions are collected into one forecast period and displayed in the Overdue column in the Cash Forecast amounts window and the Cash Forecast Report. If you select Include in the Overdue Transactions field, the Cutoff Period field is activated and you must enter a value in this field to determine the period for which you want to include the overdue transactions.
Select a transaction calendar in the Business Calendar field. A transaction calendar specifies your company's working days.
Note
If you are preparing a Cash Forecast for a project, enter a Start and an End date in the Projects Start and End fields. This will enable Oracle Cash Management to prepare a cash forecast for each project in that date range.
Click the Columns button. The Forecast Template Columns window opens, as shown below
The Forecast Template Columns Window
Type a number in the Column Number field. This must be an integer between 1 and 999. Define as many columns as your forecast needs. Save and close window.
Note
You can define up to 80 columns in a forecast template.
Click the Rows button. The Forecast template Rows window opens, as shown below
The Forecast Template Rows Window
Type a Row Number to specify the sequence of the Source Types. The values you enter here should range between 1 and 999.
Select a source type in the Source field. The source type specifies the source of cash outflow and cash inflow. Type the relevant selection criteria for the source type chosen.
Save and close the form.
Creating Cash Forecasts
Cash forecasts allow you to estimate the cash needs of your company and evaluate your company's liquidity position.
You can use a cash forecast template to create cash forecasts. To create the cash forecast:
Select Other –> Concurrent. The Find Requests window opens, as shown below-
The Find Requests Window
Click the Submit a New Request button. The Submit a New Request window opens, as shown below-
The Submit a New Request Window
Select Cash Forecasting by GL Periods or Cash Forecasting by Days in the Name field, depending on the template you want to use. The Parameters window appears, as shown below-
The Parameters Window
In the Parameters window:
In the Template Name field, select the name of the template you created or any other template that you need to use to create the cash forecast.
Type a name for the forecast in the Forecast Name field. The forecast will be created after the concurrent request is executed.
Type the name of the GL Calendar in the Calendar Name field. You type the name of the GL calendar only when you submit a forecast by GL Period.
Type a value in the Start period field. This date reflects the accounting period or the day to begin the forecast.
Type the start and end numbers for the range of projects that you want to include in the forecast in the Start and End Project fields.
Select the currency in which you want the forecast amounts to be displayed in the Forecast Currency field.
Type the currency type for the sources in the forecast in the Source Currency Type field.
Type the currency for source transactions in the Source Currency field.
Type the exchange rate date and exchange rate type as defined in the Oracle GL in the Exchange Date and Exchange Type fields. You need to define these fields if the Forecast Currency and the Source Currency are different.
In the Exchange Rate field, type user-defined when the exchange type is User.
Type the minimum value of individual transactions to be included in the forecast in the Amount Threshold field.
Select a value in the Row Number From/To field. This field provides a list of values to run a partial forecast for the sequential rows of the template that you are using.
Select Yes in the Request by Row field if you want to submit a separate concurrent request for each row. This will result in the rows for the forecast being generated concurrently and is useful in cases where the forecast includes a large amount of data. Alternatively, select No.
Click the OK button. The Parameters window closes and the Submit Request window reappears.
Click the Submit button to execute the concurrent request. The Decision window appears.
Record the Request ID number and click the No button. The Submit Request window closes and the Find Requests window appears.
Click the Find button. The Requests window appears.
Locate your request with the help of the Request ID number you noted in Step 5.
Review the Cash Forecast and Cash Forecast Execution reports. Then, select the appropriate report and click the View Output button to review the report online.
You can use Cash Forecasting tool to utilize external source of data as cash inflow and outflow data for the Cash Forecasting Feature.
Using Cash Management, you can view the cash forecast information in a spreadsheet format. The Cash Forecast Report uses the Oracle Report exchange utility to export your cash forecast data to the spreadsheet application of your choice.
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