Cash flow in Microsoft Dynamics 365 Business Central
Cash flow, Forecasting, ERP

Cash flow has always been a problematic area for many businesses to maintain as you need to get some of the detail for cash flow or cash flow forecasting out of the ERP’s AR, AP and Bank. Then you need to collate it with manual entries that are not reflected in the GL.


Usually you would just solve this with Excel, but for many reasons this is not ideal. It is important to keep Cash flow in the ERP and the good news is that it doesn't have to be hard to maintain.

Cash flow in Microsoft Dynamics 365 Business Central image

In Microsoft Dynamics 365 Business Central, you can use the Cash Flow functionality to forecast and generate predictions of a company’s cash flow. A company’s cash flow indicates its financial solvency and reveals whether the company can meet its financial obligations in a timely manner.

To make sure a company is solvent, a future-oriented planning instrument is necessary. Building on the currency assets of the previous period, the program creates a periodic compilation and calculation of the forecasted operational revenues and expenses. Then, the program calculates the cash surplus or the cash deficit. According to these results, the company can make adjustment measures, such as a credit reduction for a surplus or borrowing if there is a deficit.

Microsoft Dynamics 365 Business Central uses the following sources to calculate a cash flow forecast:

  • Receivables
  • Payables
  • Liquid funds
  • Manual expenses/revenues
  • Sales/Purchase orders
  • Fixed assets budgets/disposals
  • Service orders
  • G/L budgets
  • Jobs
  • Taxes
  • Cortana Intelligence

You can configure the Cash Flow functionality by using Assisted Setup. Run with a wizard, Assisted Setup will guide you through configuring most of the cash flow functions automatically.

This Assisted Setup functionality comes in addition to:

  1. Cash flow forecasting - a way to calculate the cash flow of your business and save the values as history
  2. Cash flow Manual Revenues and Expenses - a function to record possible (but not confirmed) sources of revenues and expenses
  3. Cash Flow Worksheet - a function by which the system calculates cash flow movements.

If you'd like to learn about Assisted Setup or our training offering on financial processes, contact us here.