There are three key performance levers of cash forecasting:
1. Visibility: Ability to view forecasts by categories, regions, and entities and track individual cash flows.
2. Accuracy: The efficacy of the forecasts required to make confident decisions.
3. Frequency: The forecasting cadence required to make timely decisions.
Since the data is scattered across several entities such as TMS, ERPs, bank portals, sales order systems, etc, it hinders visibility. Low visibility may also stem from non-standard processes, currency fluctuations, which lead to inaccurate forecasts.
Accuracy is affected due to:
1. Process inefficiencies such as:
2. Dynamic factors such as:
Due to the high turnaround time for generating forecasts, the frequency of forecasting is not timely enough.
The vicious cycle of cash forecasting causes data overload with a scope of error. CFOs have to rely on static and outdated data for making decisions.
Apply Direct Forecasting: Building local forecasts from the ground up at individual entity, company code, and currency levels, that ultimately roll up to central treasury. This provides transaction-level granularity.
The HighRadius™ Treasury Management Applications consist of AI-powered Cash Forecasting Cloud and Cash Management Cloud designed to support treasury teams from companies of all sizes and industries. Delivered as SaaS, our solutions seamlessly integrate with multiple systems including ERPs, TMS, accounting systems, and banks using sFTP or API. They help treasuries around the world achieve end-to-end automation in their forecasting and cash management processes to deliver accurate and insightful results with lesser manual effort.