How to build a cash flow forecast when you earn and spend in several currencies

A company that sells to US clients in dollars, pays a team in euros and pounds, and keeps its books in one of them has three cash positions. If you add them together too early, a euro shortfall can hide inside a healthy dollar balance until payroll day. The method below keeps them apart until you choose to combine them.

Step 1: one sheet per currency

Make a 13-week grid for each currency you hold or owe. Use the currency itself, not your reporting currency. Rows:

• Opening balance
• Receipts: customer payments by expected date, platform payouts
• Payments: payroll, contractors, suppliers, rent, software, tax
• Closing balance

A 13-week direct forecast (actual cash in and out, by week) is the standard short-term tool. It is concrete enough to check against your bank every Friday.

Step 2: date receipts honestly

Use the date you expect cash, not the invoice due date. If a client always pays ten days late, forecast ten days late. If an international wire usually takes three days, add three days. Our guide to Swift fees and timing gives typical delays.

Step 3: find the low point in each currency

Look at the lowest closing balance on each sheet. That number matters more than the total. A business can be cash-rich in dollars and still miss euro payroll.

Step 4: plan conversions

Where a currency goes negative, plan a conversion before that week, from a currency with surplus. Write it into both sheets: out of USD, into EUR. Now you can see how much you convert, how often, and at what rate.

Step 5: one rate, then a stress test

Pick one rate per pair for the whole forecast, and write it at the top. Then run it again with each rate moved 5% and 10% against you. If a 10% move turns a quarter negative, you know where your exposure is. The FX risk guide explains the main ways to reduce it.

Step 6: match currencies where you can

The cheapest conversion is the one you skip. Pay euro contractors from euro income. Bill US clients in dollars and pay US software in dollars. Only the net difference needs converting. This is called a natural hedge, and it needs balances in each currency rather than one account that converts everything on arrival.

Step 7: combine at the end

Only now convert each sheet's closing balances into your reporting currency at your stated rate, for a single total. Use that total for the board deck. Use the currency sheets for decisions.

An example

Week 4 shows a euro gap. Converting USD to EUR in week 3 fixes it, and the forecast shows the amount needed.

Balances on Rivet

Rivet holds USD, EUR and GBP balances side by side on the Growth plan, so euro costs can be paid from euro income, and conversions show the rate before you confirm. See Pricing.