Forecasting cash in the months before an event
How an organiser forecasts cash when venue and supplier deposits go out months before ticket and sponsor money arrives, and where the figures come from.
By Achekam · · 5 min read · For Events businesses in South Africa, Nigeria, Kenya
The venue wants its deposit when you sign. The staging company wants a deposit with the order. The caterer wants a commitment fee before it will hold the date. Meanwhile early-bird tickets trickle in, the main sponsor pays in instalments that depend on milestones, and most delegates register in the last few weeks.
An events business lives with this timing every year. The budget may show a healthy surplus, yet for several months the bank balance is under pressure, and one late sponsor payment can mean the organiser cannot pay a supplier on time. A cash forecast is how you see that squeeze coming while you can still do something about it.
A profitable event can still run dry
ACCA makes the point plainly in its guidance on cash budgets: a healthy profit does not necessarily mean a healthy cash flow, because labour, materials and overheads may have to be paid before the cash from sales arrives. For an organiser, the "materials and overheads" are venue hire, production, marketing and the team's salaries, and nearly all of them are paid before the doors open.
The profit and loss for the event tells you whether the event was worth doing. It says nothing about whether you could pay the lighting company in the month before the show. Those are separate questions, and they need separate reports.
The inputs an event forecast needs
ICAEW lists the usual inputs for a cash flow forecast: monthly turnover, cost of sales, how long the business takes to pay its suppliers and how long customers take to pay it, inventory, rent dates, capital spending, and tax and loan repayments. Its helpsheet on cash flow forecasts explains each one and adds that a forecast need not be complicated: a spreadsheet, an app or an online accounting system will do.
Translated into an event, the inputs look like this:
- Deposit and balance dates in each venue and supplier contract, with the amount due on each date.
- Supplier terms for bills that arrive after the event, such as transport, extra security or overtime.
- Ticket and registration patterns from past events: how much sells at launch, how much in the middle, how much in the final weeks.
- Sponsor instalments, with the condition attached to each one: signature, branding approval, delivery on the day.
- Exhibitor stand payments, often invoiced with terms rather than paid upfront.
- Tax payments that fall in the period, and any loan or overdraft repayments.
- Equipment purchases you plan to make for this event rather than hire.
ICAEW also advises revisiting the inputs regularly, and closely when the business is going through change. A new venue, a new city or a new sponsor is exactly that kind of change.
Three versions of the same months
One forecast is not enough when so much depends on how sales go. ICAEW recommends worst-case, most-likely and best-case scenarios, including a prediction of the earliest date additional funding may be required.
For an organiser that last point is the useful one. Lay the three versions side by side, month by month, and find the first month in which the worst case dips below the cash you need to keep. That is the date by which you must have a plan: an overdraft agreed, a supplier persuaded to take a later balance payment, an earlier sponsor instalment, or a decision to cut a line from the production. Talking to the bank months ahead is a very different conversation from asking a week before the deposit is due.
Detail behind each expected receipt
A forecast built on one line called "ticket income" hides where the risk sits. ICAEW advises keeping detailed data behind the forecast, particularly for money owed to you, with expected, worst-case and best-case dates, maximum, expected and minimum amounts, the probability of collection and a named person responsible for each item.
For an event, that detail might be kept like this:
| Item | Dates (best / expected / worst) | Amounts (max / expected / min) | Likelihood | Who chases it |
|---|---|---|---|---|
| Main sponsor, second instalment | Set against the contract milestone | The contract amount, or less if a benefit is dropped | Depends on the milestone being met | Sponsorship manager |
| Exhibitor stand invoices | Invoice date plus terms | Stands sold so far, to full floor plan | Based on how these exhibitors paid before | Accounts |
| Ticket sales in the final month | From past sales patterns | From the registration forecast | Lower for a first-time event | Marketing lead |
Naming who chases each receipt matters as much as the numbers. A sponsor instalment that nobody owns tends to be noticed only when it is already late.
Where the figures come from in Achekam
Achekam does not produce a cash flow statement from the books, so the forecast itself is a schedule you keep, in a spreadsheet or similar, as ICAEW suggests. What the books give you is the material to fill it in accurately:
- Budgets. A business can set a budget per account and period and compare it with the actual figures in its ledger, so the event's planned costs are already spread across the months.
- Committed spend. Approved purchase orders count as committed spend against the budget for each expense account and period. The screen shows budget, spent, committed and available, and flags over-committed lines without blocking the purchase. Committed orders are your best guide to supplier payments still to come.
- Money owed to you. Receivables are aged into 0-30, 31-60, 61-90, 91-120 and over 120 days, with overdue totals. Sponsors and exhibitors who are already slow show up there before they show up as a gap in the bank.
- Management accounts. An income statement for a chosen period beside the period before, and a balance sheet at period end, both built from the business's own journals and exportable as PDF or CSV. The year-to-date preset starts on 1 January, so pick the dates yourself if your financial year starts in another month.
Update the forecast from these each week in the run-up, not only at month end.
After the event: test the forecast
ICAEW's last piece of advice here is the one most often skipped: check forecasts against what actually happened, to improve the process. Once the event has settled, compare each forecast receipt and payment with the real date and amount. Did tickets sell later than you assumed? Did a supplier insist on payment earlier than the contract said? Those differences become next year's assumptions.
The next step
Start with the contracts already signed for your next event, list every deposit and balance date, and set them against the most cautious view of ticket and sponsor income. The payments side is covered in more detail in deposits paid to event vendors, and controlling what gets ordered in the first place in keeping vendor spend inside the event budget.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
