Cash Flow Tracking Dashboard for CFO: KPIs and Example

Introduction

In today’s uncertain business climate, treasury and finance professionals need quick access to real-time cash and liquidity data for smarter decision-making. A key concern is how often treasurers check their bank statements and cash accounts and whether they struggle to see the big picture of cash positions and future forecasts across different entities, bank accounts, and business areas.

Traditionally, treasurers have relied on static dashboards and Excel spreadsheets for managing cash flow. However, these tools are inefficient and cluttered, limiting their ability to provide a clear view of cash. They mainly show past and current cash trends without the capability for advanced analysis or spotting real-time anomalies or discrepancies. This makes the process of managing cash positions time-consuming and error-prone. This is where a cash flow dashboard comes into play.

In this blog, we will understand what cash flow dashboards are, their importance, and the key features that organizations should look for when selecting a cash flow dashboard for their business.

What is a Cash Flow Dashboard: What Does it Contain?

A cash flow dashboard is a visual tool used by businesses to effectively manage their cash position. It includes key financial metrics such as current cash balances, cash inflows and outflows, and forecasts of future cash movements, providing a real-time snapshot of the organization’s financial health. This allows treasury and finance professionals to make informed decisions.

The dashboard often features graphs, charts, and tables that summarize cash flow data from various sources, such as bank accounts, invoices, and expenses. In addition to basic cash flow information, a comprehensive dashboard may also incorporate advanced analytics capabilities. This includes trend analysis, variance identification, and predictive insights to anticipate cash flow fluctuations and potential financial risks. By consolidating and visualizing critical financial data in one place, cash flow dashboards help streamline financial management processes, enhance transparency, and improve overall cash flow management strategies within an organization.

Why Does A Business Require A Cash Flow Forecasting System Dashboard?

The absence of a centralized cash flow dashboard, where businesses can see their complete cash positions, presents many challenges, such as:

1. Limited visibility: Traditional tools can only provide limited visibility into cash positions. This means that treasurers may miss important trends or anomalies that could affect their cash position.

2. Time-consuming processes: Traditional tools require a lot of manual maintenance. This can take up valuable time that could be better invested in other tasks.

3. Error-prone processes: Traditional tools are prone to errors, which can lead to inaccurate cash positioning. This can have serious consequences on a company’s financial health.

Real-time insights into cash flow are essential for businesses to remain competitive in today’s fast-paced environment. A well-designed cash flow dashboard provides a comprehensive and user-friendly view of your financial situation, enabling you to make informed decisions with confidence. With advanced analytics, machine learning, and seamless integration with multiple data sources, an optimized dashboard can help you streamline your cash flow management and eliminate manual processes.

7 Key Features of Real-Time Cash Flow Dashboards

A real-time cash flow dashboard transforms the way businesses manage their finances and provides them with a competitive edge. Let us understand what the key features of a cash flow dashboard are:

1. Advanced analytics:

• Data mining with advanced analytics powered by artificial intelligence extracts key insights and trends.
• Predictive modeling and forecasting capabilities anticipate future trends and risks.
• Integration of financial and non-financial data provides a holistic view of an organization’s performance.

2. User customization:

• Multiple charting options for visualizing data in different ways.
• Data slicing and dicing with custom user-defined measures and calculated fields for a more granular view of financial performance.
• User-defined alerts provide real-time updates on critical financial metrics.

3. DIY functionality for cash flow forecasting:

• Flexible, self-service dashboards allow users to derive key business insights and create intuitive visualizations.
• Interactive cash flow dashboards provide real-time feeds and reports to support decision-making.
• Scenario modeling and stress-testing capabilities assess the impact of potential changes in the business environment.

4. Machine learning-powered engines:

• Automated anomaly detection identifies potential issues before they arise.
• Pattern recognition identifies trends and opportunities for improvement.
• Predictive analytics anticipates future trends and risks.

5. Seamless connectivity and integration:

• Integration with multiple internal and external data sources to provide a comprehensive view of the organization’s performance.
• Automated data refresh and synchronization ensures data accuracy and consistency.
• API integration with other financial management tools streamlines processes and improves efficiency.

6. Real-time updates and alerts:

• Enables faster and more accurate decision-making with real-time updates and alerts.
• Automated notifications for critical financial metrics such as cash balance, liquidity ratio, and working capital.

7. Process automation:

• Eliminates time-consuming, error-prone, and manual cash flow processes to streamline financial management.
• Workflow automation reduces the time and effort required to perform routine financial tasks.
• Ensures regulatory compliance for audit trail and compliance reporting.

How KPI Dashboard Metrics Can Maximize Cash Flow Management

Leveraging five key metrics to enhance cash flow forecasting and financial decision-making

Effective cash flow forecasting is critical for the financial success of all businesses. However, without a clear understanding of key performance indicators (KPIs) and metrics, it can be difficult to make informed decisions about cash management. This is where a well-designed KPI dashboard proves invaluable.

In particular, five critical metrics should be displayed on a KPI dashboard for effective cash flow management:

• Cash inflows and outflows
• Consolidated actual cash position
• Total actual and forecasted liquidity
• Covenants and net debt management
• Variance analysis between actual and forecasted cash

By leveraging these metrics and regularly monitoring them through a KPI dashboard, businesses can gain a clearer understanding of their financial position. Ultimately, this can help to maximize cash flow, increase profitability, and drive overall business success.

1. Walkthrough of cash flows: A cash flow walkthrough enables businesses to visualize the steps between an opening cash balance and a closing cash balance. The journey is divided into stages that show how the net cash balance has changed positively or negatively. Cash inflow categories, such as customer receipts and investing inflow, can be color-coded on a graph to visualize the relevant information. The primary cash outflows, such as supplier payments or taxes, should also be accounted for. The primary advantage of visualizing data is that it highlights each cash flow category’s impact on the cash balance., For example, a treasurer or financial planner could immediately see whether supplier payments negate the combined contribution of customer receipts, investing inflow, and dividend receipts using a cash walkthrough graph.
2. Consolidated actual cash position: Large businesses, particularly those with a global presence, frequently struggle to maintain an up-to-date, centralized single-currency view of their cash position and current and forecasted cash levels. This is entirely understandable, given the number of subsidiaries and bank accounts involved. However, because bank data is fed directly into the dashboards, a real-time view of daily consolidated cash positions is easily available.
3. Total actual and forecasted liquidity: Most large corporations have multiple external liquidity sources. Cash flow forecasting dashboards must show actual and forecasted liquidity. This serves as the foundation for accurate cash reporting and decision-making.
4. Covenants and net debt management: Net debt and covenant metrics, while not strictly cash and liquidity metrics, are closely tied to them and are important to monitor. Significant changes in optimizing cash flow can impact net debt and covenant levels if underlying earnings decline. This will most likely limit the company’s ability to access liquidity and use the cash generated as intended (e.g., capital expenditures.). Because of their significance, net debt and covenant figures must be visible to all relevant stakeholders and managed proactively.
5. Variance analysis between actual and forecasted cash: It may appear counterintuitive to highlight actual versus forecast differences on a spreadsheet. However, if handled properly, it can significantly boost the credibility of the overall cash reporting process and the dashboard itself. By highlighting variance finance our treasury teams can control the process and prevent crisis. Including high-level forecast variance analysis on the dashboard helps users understand the major factors influencing forecast accuracy and ensures continuous monitoring of data Quality.

Cash Flow Dashboard Example

The above dashboard has several components that give a detailed overview of a company’s cash flow. Here’s a breakdown of each section:

1. Cash flow summary: This section provides an overview of the company’s cash flow for the selected period. It includes the beginning balance, total cash inflow, total cash outflow, and ending balance.
2. Cash flow chart: This section displays the company’s cash flow trend over time. The chart shows the net cash flow (inflow minus outflow) for each month or quarter and enables decision-makers to quickly identify trends and changes in cash flow.
3. Top inflows and outflows: This section displays the top sources of cash inflow and outflow for the selected period. This information can help decision-makers identify areas where the company is generating or spending the most cash.
4. Inflow breakdown: This section breaks down the company’s cash inflow into categories, such as sales revenue, investment income, and financing. It also shows the percentage or amount of total inflow represented by each category.
5. Outflow breakdown: This section breaks down the company’s cash outflow into categories, such as operating expenses, capital expenditures, and debt payments. It also shows the percentage or amount of total outflow represented by each category.
6. Cash flow by customer or vendor: This section displays the company’s cash flow by customer or vendor. It shows the total amount of cash received from each customer or vendor, as well as the total amount of cash paid to each customer or vendor.

How to Choose the Right Cash Flow Dashboard for Your Company?

When it comes to selecting financial dashboard software for your company, there are a few important factors to consider.

1. Specializations vs. versatility: You can opt for software that solely focuses on financial dashboards or choose a tool with advanced analytics that can also enhance your cash flow.
2. Integration: Integration is crucial; your new software must integrate with your existing finance stack. Otherwise, you’ll have to transfer data manually, defeating the purpose of automating your tasks. Ensure that the software you select has a robust API and can connect with third-party apps seamlessly.
3. Specific feature requirements: It’s also essential to consider the specific features you require in a cash flow dashboard. Mapping out your needs in advance will help bring clarity to the selection process. This exercise will also help you determine if you can satisfy your needs with an analytics feature of existing software or require a dedicated tool for greater depth.
4. Long-term planning: Thinking long-term is critical since tomorrow’s needs will differ from today’s. It’s vital to think ahead when it comes to your finances. Although you may be able to cope with a reduced scope currently, preparing for the future today while the urgency isn’t too high is a wise decision.

Make Informed Decisions With HighRadius Cash Flow Forecasting Software

HighRadius Cash Flow Forecasting Software is a valuable tool that offers several features, including:

• A single point of information on net cash flows
• High cash flow visibility across multiple entities, cash flow categories, and regions
• View of forecasts versus actuals to understand variance
• Ability to make data-driven decisions
• Creation of visual reports

Here’s how these features add value to your cash forecasting process.

• Uses proprietary auto-machine learning to predict cash flows for daily, weekly or yearly projections.
• Build scalable cash flow excel dashboard models using Excel-like functions, consolidating forecasts across cash categories and company codes to improve global inflows and outflows forecast accuracy by 95%.
• Enhances AR and AP cash flow forecasts using ERP data (invoices, sales orders), improving accuracy with account-specific predictions.
• Easily create what-if scenarios and compare impacts on cash flow, such as project delays or capital investments.
• Track and analyze forecast vs. actual cash flow differences, ensuring financial decisions align with projections. This increases forecasting productivity by 70%.
• 100% Automated Bank Integration for rapid access to statements, categorizing cash inflows and outflows automatically.
• Integrates with ERP systems like SAP via API or file-based methods to enrich forecasts with AR, AP, and customer data.

Enhance your organization’s cash flow management and decision-making with HighRadius Cash Flow Forecasting Software Dashboard.

FAQs

1. What is a cash flow dashboard?

A cash flow dashboard is a visual representation of a company’s cash position that provides key insights into a company’s cash inflows and outflows, bank balances, and risk trends in real-time. It enables businesses to track financial health, identify trends, and make informed financial decisions.

2. What is a cash flow forecast dashboard?

A cash flow forecast dashboard is a visual tool that displays real-time or projected cash flow data in a concise and accessible format. It provides insights into expected cash inflows and outflows over a specified period, helping businesses make informed financial decisions and manage liquidity effectively.

3. How do you do cash flow monitoring?

Cash flow monitoring involves regularly tracking your company’s cash inflows and outflows and comparing them to your earlier projections to identify any variances or anomalies. This can be done manually or by using an automated cash flow monitoring tool like a dashboard or software.

4. What are the areas to look at when monitoring cash flow?

When monitoring cash flow, you should pay attention to several key areas, including cash inflows (e.g., sales, investments, loans), cash outflows (e.g., expenses, payroll, debt payments), cash balances, liquidity ratios, and cash flow projections.

5. What is the key to managing cash flow?

The key to managing cash flow is to have a good understanding of your business’s cash inflows and outflows, maintain adequate cash reserves, and manage your working capital effectively. This involves optimizing your inventory, managing your accounts payable and receivable, and prioritizing your cash outflows.

6. How do you manage cash flow effectively?

To manage cash flow effectively, you need to create a cash flow forecast, regularly monitor cash position, manage working capital, prioritize cash outflows, maintain adequate cash reserves, and consider using a cash flow management software. It’s also important to stay on top of your financial reporting and seek professional advice.