Vittaldas V Prabhu, Thesis Supervisor Dr. Paul M Griffin, Thesis Honors Advisor
Keywords:
Cash Flow Forecasting Financial Engineering
Abstract:
This thesis is focused on how data analytics can be used to improve the accuracy of cash flow forecasting. Cash flow forecasting is an important financial measure for firms to manage in order to ensure that financial obligations are met. It is particularly important for smaller enterprises, such as start-ups and small businesses that do not have stable finances. Failure to properly manage cash flows could result in abrupt bankruptcy and other undesirable consequences. Accurate flow forecasting is a viable means of properly managing cash flows. The primary goal of this thesis is to apply a newly developed stochastic cash flow forecasting technique to an existing company’s data accounts receivable and invoice data. The technique used provides a more robust and accurate forecast of monthly and annual cash flows than standard forecasting techniques. Justification for the relevancy of the proposed model will be provided through research into the importance of cash flow forecasting.
