Build a program-level budget, create a rolling 6–12 month cash forecast that maps grant payment timing, and model scenarios so you can spot shortfalls early and plan mitigations like bridge funding or rephasing purchases.
On the go? Listen on The Deep Dive — where we dig deeper into this topic: ‘Nonprofit Cash Flow Crisis Solved_ How to Build a 6-Month Rolling Forecast and Negotiate Grant Advances’. Listen or download.
Why this matters
Nonprofits face timing mismatches between when awards are earned and when cash arrives. Large program expenses often occur before grant payments come in, and fundraising can be seasonal. A clear cash forecast prevents missed payroll, program interruptions, and costly short-term borrowing.
Short story
A food-security nonprofit won a multi-year grant paid quarterly while the program required monthly supply purchases. Without forecasting they ran low on cash and took a short-term loan. After implementing a 6-month rolling cash forecast and negotiating an advance with the funder, they avoided borrowing and purchased supplies at lower cost.
How to build the forecast
- Create a detailed program-level budget (monthly granularity) with salaries, program supplies, travel, and indirect costs.
- List expected revenue by month, including grant payment schedules, pledged amounts, and fundraising events.
- Start the forecast with beginning cash, add expected receipts, subtract budgeted payments and loan repayments, and calculate ending cash for each month.
- Build scenarios: base (expected), best (on-time receipts), and downside (delays in grant payments or lower fundraising).
- Flag months with negative ending cash and prepare mitigation options: request advanced drawdowns, rephase purchases, cut discretionary spending, or secure short-term credit.
- Review the forecast monthly with leadership and update assumptions as new information arrives.
Key metrics to track
- Months of operating cash (reserve) — aim for 1–3 months.
- Unrestricted cash balance — usable for operations and bridging.
- Grant receivables by month — expected but not yet received.
- Net cash flow per month under each scenario.
Sample 6-month cash forecast (example)
Use the CSV template below—start with beginning cash, list receipts and payments per month, and calculate ending cash. Update monthly.
CSV copy (paste into Google Sheets or Excel):
Month,Beginning Cash,Expected Receipts,Expected Payments,Net Change,Ending Cash,Notes
Jan 2025,25000,12000,30000,-18000,7000,Grant A payout delayed
Feb 2025,7000,30000,15000,15000,22000,Major fundraiser expected
Mar 2025,22000,8000,18000,-10000,12000,Seasonal dip
Apr 2025,12000,15000,13000,2000,14000,Reissued invoice payment
May 2025,14000,10000,16000,-6000,8000,Grant drawdown planned
Jun 2025,8000,20000,12000,8000,16000,Reforecasted donations
Here’s a ready-to-use CSV you can open in Google Sheets or Excel.
Download the CSV — NonProfit Cash Forecast Template
Actionable steps & tools
- Use a spreadsheet template — Start simple with a rolling 6-month template and expand to 12 months as needed.
- Link to accounting data — Pull actual receipts and expenses monthly from your ledger to compare plan vs actual.
- Maintain a grant payment calendar — Record contractual payment dates and expected amounts to avoid surprises.
- Scenario planning — Model a downside case with delayed payments and pre-approved mitigation actions.
Quick checklist
- Build program-level monthly budgets
- Create a 6-month rolling cash forecast
- Map grant payment timing to forecast receipts
- Identify months with negative ending cash and mitigation options
- Review forecast monthly with leadership
Think of your nonprofit like a stage production: grants are the leads, fundraising is the chorus, and cash is the stage crew that keeps the lights on. If the stage crew goes missing, the show stops. Build a rolling cash forecast to keep the lights on — and if you’d like, we’ll help write the cue sheet. Book a free 30-min exploration call today.
Giesler-Tran Bookkeeping • gieslertranbookkeeping.com • 971-200-5158