Why the forecast decides the outcome
Historic accounts tell a lender where you have been. The forecast tells them whether the facility can be serviced. When a credit paper is written, the analyst lifts the monthly closing balance line, the peak funding requirement and the debt service cover directly from your model.
If those three figures are unclear or inconsistent with the accounts, the request stalls regardless of how strong the business is.
The structure credit teams expect
Build monthly for twelve months, with receipts, payments, financing movements and a closing bank balance. Show the requested facility as a separate line so the reader can see the position with and without it.
Split receipts by revenue stream where the collection profile differs, and reflect real debtor days rather than invoice dates. Payments should include payroll, tax, rent, interest, capital repayments and capital expenditure as separate lines.
Evidencing assumptions
Every material assumption needs a source: a signed contract, an order book, last year's actuals, a supplier quotation or an agreed payment plan. A one page assumptions note beside the model answers most of the questions a first review would otherwise generate.
Where growth is assumed, show the pipeline that supports it. Unsupported growth is the fastest route to a reduced offer.
Sensitivities and the downside case
Present a base case and at least one downside: revenue reduced by ten to fifteen per cent, or debtor days extended by two weeks. Showing that the facility still services under stress builds far more confidence than a single optimistic case.
Lenders are not deterred by a modest downside. They are deterred by the impression that it was never considered.
Common mistakes
Forecasting profit rather than cash, omitting VAT and payroll taxes, ignoring the timing of quarterly payments, showing a facility drawn on day one and never repaid, and producing a model that cannot be reconciled to the latest management accounts.
Global Funding Gateway reviews the model before it reaches a lender and rebuilds the presentation where needed, with no upfront fees.
Frequently asked questions
How long should the forecast run?
Twelve months monthly is the standard for working capital facilities. Term debt and property transactions usually need a further two to three years at annual granularity.
Should the forecast include the new facility?
Yes. Show the position both with and without it so the reader can see exactly what the money solves.
Do lenders check the forecast against actuals later?
On most committed facilities yes, through quarterly management information. Persistent large variances can trigger a covenant review.
Last reviewed: 2026-08-20