What is cash budget in SAP FI - Financial Accounting?

SAP Term: cash budget

• Component: FI

• Component Name: Financial Accounting

• Description: An estimation of the cash inflows and outflows for a specific period of time. A cash budget can be prepared on a daily, weekly, or monthly basis.

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• Key Concepts: 
  Cash budget is a financial planning tool used in SAP Financial Accounting (FI) to forecast and manage cash flow. It helps to identify potential cash shortages or surpluses, and plan for future cash needs. The budget is based on the expected inflows and outflows of cash, such as sales, purchases, investments, and expenses. 
  
  How to use it: 
  In SAP FI, cash budget can be created by entering the expected inflows and outflows of cash into the system. The system will then calculate the expected balance of cash at the end of each period. This information can be used to plan for future cash needs and identify potential cash shortages or surpluses. 
  
  Tips & Tricks: 
  It is important to keep the cash budget up-to-date in order to accurately forecast future cash needs. It is also important to review the budget regularly to ensure that it is accurate and up-to-date. 
  
  Related Information: 
  Cash budget is closely related to other financial planning tools such as financial statements, balance sheets, and income statements. These tools can be used in conjunction with the cash budget to provide a more comprehensive view of a company’s financial health.