cash budget

economics

Also known as: cash forecast

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Last updated

June 24, 2026

Quick Summary

A cash budget is a projection of a business's future receipts and expenditures. It is a key component of budgetary planning, which helps management forecast financial needs and operational outcomes.12

The cash budget specifically predicts the combined effects of planned operations on a firm's cash flow. This forecast indicates whether the business will have surplus funds for investment or require additional financing due to a negative cash flow. It details anticipated cash payments, receipts, and the amount of cash on hand, typically on a month-by-month basis. This allows financial managers to plan for seasonal fluctuations, build reserves, or find short-term investments for excess cash. While similar to a business's cash flow account, government cash budgets can sometimes lack direct ties to decision-making due to lags between incurring liabilities and making payments.324

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business finance
The cash budget
One of the principal methods of forecasting the financial needs of a business is the cash budget, which predicts the combined effects of planned operations on the firm’s cash flow. A positive net cash flow means that the firm will have surplus funds…
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One of the principal methods of forecasting the financial needs of a business is the cash budget, which predicts the combined effects of planned operations on the firm’s cash flow. A positive net cash flow means that the firm will have surplus funds…
Read More

government budget
Cash and unified budgets
Faced with the increasing complexity of government activities, many countries have fallen back on the idea of the cash budget. This has the merits of simplicity and comprehensiveness. As used in the United States, it presents total payments by the federal…
Read More
Faced with the increasing complexity of government activities, many countries have fallen back on the idea of the cash budget. This has the merits of simplicity and comprehensiveness. As used in the United States, it presents total payments by the federal…
Read More

accounting
Budgetary planning
…budget, the cash forecast or cash budget, summarizes the anticipated effects on cash of all the company’s activities. It lists the anticipated cash payments, cash receipts, and amount of cash on hand, month by month throughout the year. In most companies, responsibility for cash management rests mainly in the head…
Read More
…budget, the cash forecast or cash budget, summarizes the anticipated effects on cash of all the company’s activities. It lists the anticipated cash payments, cash receipts, and amount of cash on hand, month by month throughout the year. In most companies, responsibility for cash management rests mainly in the head…
Read More