Cash Flow Statement and Forecasting: IAS 7 Preparation and 13-Week Cash Models – London, 19–23 Jul 2027

Programme overview

Introduction:

Many finance teams produce the cash flow statement last, as a balancing exercise, so misclassified capital creditors, missed non-cash items and unexplained exchange differences reach auditors and lenders. The same teams then forecast cash from a spreadsheet that does not tie back to the ledger or the budget. This Core Concept course teaches the cash flow statement under IAS 7 step by step, by the indirect and direct methods, and then turns the same drivers into a 13-week and monthly rolling cash forecast. Participants build a Cash Flow Statement and 13-Week Forecast Pack for a case company.

Course Objectives:

• Classify receipts and payments into operating, investing and financing activities under IAS 7 and document the judgement behind each policy choice
• Prepare the operating section by the indirect method from a balance sheet movement worksheet and derive the direct method from ledger control accounts
• Present consolidated cash flows with intragroup eliminations, subsidiary acquisitions and disposals and the effect of exchange rate changes on cash
• Draft the non-cash transaction note and the reconciliation of liabilities from financing activities and review the statement against an error checklist
• Build a 13-week receipts and disbursements forecast and a monthly rolling forecast driven by working capital days and linked to the budget
• Explain cash performance with free cash flow, a profit-to-cash bridge, scenario tests and actual-versus-forecast variance analysis

Target Audience:

• Accountants who prepare the statement of cash flows and its supporting notes at each reporting date
• Reporting staff who consolidate group cash flows across subsidiaries and currencies
• Planning and analysis staff who produce monthly cash projections alongside the budget
• Treasury staff who maintain short-term receipts and payments forecasts
• Controllers and reviewers who sign off cash flow figures before release to auditors, lenders or management

Course Outline:

Day 1: Purpose of the Statement of Cash Flows and Classification Judgements

• Cash and Cash Equivalents Definition: Demand Deposits, Short-Term Deposits and Bank Overdraft Treatment
• Operating, Investing and Financing Activity Classification Under IAS 7
• Judgement Calls: Capitalised Development Spend, Lease Payments and Supplier Finance Arrangements
• Interest Paid, Dividends Received and Income Tax Cash Flow Classification Choices
• Diagnostic Review of an Existing Cash Flow Statement Against Accounting Policy Notes

Day 2: Indirect Method and Direct Method Construction

• Indirect Method Starting Point and Add-Back of Depreciation, Impairment and Provisions
• Working Capital Movement Schedule: Receivables, Inventories, Payables and Contract Balances
• Disposal Gains, Unrealised Exchange Differences and Share-Based Payment Adjustments
• Direct Method Gross Receipts and Payments Derived from Ledger Control Accounts
• Balance Sheet Movement Worksheet Tying Opening and Closing Positions

Day 3: Cash Flow Analysis and Forecast Building

• Free Cash Flow Build: Operating Cash Less Capital Expenditure and Lease Principal
• Profit-to-Operating-Cash Bridge and Cash Conversion Measure
• Working Capital Driver Model Using Debtor Days, Stock Days and Creditor Days
• 13-Week Receipts and Disbursements Forecast Template by Cash Category
• Monthly Rolling Forecast Linked to the Annual Budget and Projected Balance Sheet

Day 4: Group Consolidation, Currency Effects, Disclosures and Forecast Variance

• Consolidated Cash Flows: Intragroup Eliminations and Subsidiary Acquisition or Disposal
• Exchange Rate Effect on Cash Held in Foreign Currencies
• Non-Cash Investing and Financing Transactions and the Reconciliation of Liabilities from Financing Activities
• Common Preparation Errors: Double Counting, Sign Reversal and Misclassified Capital Creditors
• Downside Cash Scenario Testing and Actual-Versus-Forecast Variance Log

Day 5: Case Company Cash Flow Statement and 13-Week Model

• Case Data Pack: Comparative Trial Balances, Fixed Asset Roll-Forward and Group Chart
• Case Statement of Cash Flows Prepared by Indirect and Direct Methods
• Case Review Checklist Sign-Off and Disclosure Note Drafting
• Case 13-Week Cash Forecast Model with Downside and Upside Scenarios
• Cash Flow Statement and 13-Week Forecast Pack Presentation to a Finance Review Panel

Skills You Will Gain:

• Cash Flow Classification Judgement
• Indirect Method Reconciliation
• Direct Method Derivation
• Consolidated Cash Flow Preparation
• Cash Flow Disclosure Drafting
• Working Capital Driver Modelling
• Short-Term Cash Forecasting
• Cash Variance Explanation

Why Attend This Course:

• Leave with a Cash Flow Statement and 13-Week Forecast Pack for a case company, reusable as a template for your own ledger
• Close the reporting period with a cash flow statement that ties to the balance sheet without a balancing figure
• Give management a cash outlook that shares its assumptions with the budget and can be explained line by line
• Compare preparation and forecasting practice with accountants and planners from manufacturing, services, construction and retail organisations

Conclusion:

A reliable cash flow statement and a credible cash forecast rest on the same foundation: clean classification and well-understood working capital drivers. The course moves from the purpose and classification rules of IAS 7, through indirect and direct method construction, to free cash flow analysis and 13-week and rolling forecasts, then to group consolidation, currency effects, disclosures, common errors and variance analysis. The final day applies every step to a case company and produces a Cash Flow Statement and 13-Week Forecast Pack ready for review.