Cash Flow Forecasting Tools and Software Comparison

Cash flow forecasting software saves businesses time and reduces the risk of errors. Automating the forecasting process is a game-changer for any organization, but migrating to a new system comes with its own set of challenges. It’s important to understand how these tools work and how to successfully integrate them into your workflow.

Introduction to Cash Flow Forecasting Software

Cash flow forecasting software is a program that’s either cloud-based or installed on a system’s hard drive. While each individual program has its own set of features, most will:

• Connect with your accounting software

• Pull data from your accounting software to build forecasts automatically

Many software programs will also allow you to create:

• What-if scenarios

• Projections

• Branded reports

Often, you can compare your planned vs. actual results, view customer insights and more. 

Cash flow forecasting software arms you with the tools you need to manage your cash flow and make smarter business decisions.

Excel vs. Dedicated Cash Flow Forecasting Software

Cash flow forecasting software can offer many benefits to businesses, but how do these tools compare to Excel?

Traditionally, cash flow forecasts were created in Excel manually. The process is both tedious and time-consuming, but it was the most practical way to create forecasts until forecasting software stepped into the picture. 

Excel can be an effective way to create cash flow forecasts, but it’s not without its limitations and issues. Using this method:

• Increases the risk of errors. Because forecasts are created in a spreadsheet, the person preparing the forecast has to pull numbers manually. The risk of human error is high, and errors can lead to inaccurate forecasts,

• Takes up a great deal of time and resources. Using Excel to create forecasts is a time-consuming process. Teams have less time to focus on important tasks that help grow the business.

Cash flow forecasting software, on the other hand, will save time and virtually eliminate the risk of human error. Accounting system integration allows the software to pull numbers automatically from your accounting software. 

Forecasting software frees up valuable time for your team and ensures that your forecasts are accurate and reliable. 

Cloud-Based vs. On-Premises Solutions

Making the decision to switch to cash flow forecasting software is an easy one. The benefits are clear. But which type of software should you choose? Both cloud-based and on-premise solutions are available.

• With cloud-based solutions, the program and your data are stored in the cloud. This means that you can access your software from any browser anytime, anywhere, and from any Internet-connected device. 

• With on-premises solutions, the program is installed on a computer hard drive. All data is stored on the drive, and you can only use the software on that particular device. 

When choosing software, weigh the pros and cons of cloud-based and on-premises solutions carefully to find the right one for your needs.

Integrating Cash Flow Software with Accounting Systems

Cash flow forecasting software relies on data. You can plug data in manually, but it’s a resource-intensive process that many owners cannot manage. In fact, when you enter data manually, it wastes time and also increases the risk of data entry errors drastically.

Accurate cash flow forecasting demands that all figures be 100% accurate.

Integration will be a top priority when trying to choose between different tools and software. You'll need to:

• Inquire about the software the solution integrates with

• Determine if your accounting system will integrate with the cash flow software properly

In the ideal world, your system will be supported by the new cash flow software, allowing you to use it with as little a learning curve as possible. If integration is not fast and automated, you should ask the cash flow software developer if they offer any additional help with getting it set up.

Many companies will help you integrate their platform with your existing systems so that there is no downtime or issues along the way.

Case Studies of Successful Cash Flow Software Implementation

Cash flow software implementation is crucial for growing businesses, but you need to do it right. Case studies can teach you a lot about how to implement these systems properly. A few studies to read through include:

• HSBC shows how they worked through streamlining automated cash flow entries and allowed their client to better control and visualize their cash position. Additionally, the new insights allowed the company to expand into new markets.

• Bank of America shows how the smooth implementation of cash flow forecasting software led to the more efficient use of client funds, data-driven insights, and the ability to make smarter business decisions.

Forecasting is one of the leading ways to make data-driven decisions, lower risk, and also secure financing or investments.

In Conclusion

Accounting system integration is crucial with any tool that you choose for your business. You’ll want to compare features, pricing and strongly consider cloud-based solutions. If you opt for on-site software, you do lose the benefit of redundancy and will need to handle all of your own hardware and software maintenance and upgrades.