Forecast Accounts Payable
Plan supplier balances and explain when purchasing activity becomes a cash payment.
Trade payables and supplier payments · FY2026–FY2027
Preview · Illustrative values · EUR thousands / Units as labeledPayables and payments
| Line item | FY2026 | FY2027 |
|---|---|---|
| Opening payables | 240.0 | 240.0 |
| Purchases | 2,760.0 | 3,584.0 |
| DPO · days | 30 | 30 |
| Trade payables | 240.0 | 288.0 |
| Supplier payments | (2,760.0) | (3,536.0) |
| AP cash effect | 0.0 | 48.0 |
| Cash flow from operations | 621.3 | 204.0 |
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Separate trade credit from financing debt
An accounts payable model forecasts operating supplier obligations carried between periods. Establish the opening balance and match it with the purchases or costs that generate trade credit. Keep loans, tax liabilities, payroll accruals and investment creditors outside the trade perimeter unless the chosen schedule explicitly covers them.
This supports the working-capital forecast. The concept guide explains why supplier credit offsets cash tied up in operating assets. More payables can preserve cash temporarily; it does not produce revenue or remove the eventual payment obligation.
State which flow drives the day assumption
A purchasing-based forecast can use AP = purchases × DPO ÷ period days. BalanceCheat’s financial model instead uses positive annualized COGS with a 365-day basis. This is a documented cost-based convention, not a claim that purchases always equal COGS.
The DPO calculator accepts purchases and labels the COGS approximation. Develop the operating cost base in the COGS model and reconcile inventory-driven purchases through the inventory forecast. Keep the chosen convention visible when comparing historical ratios with future assumptions.
Build a closing supplier balance
The preview’s EUR 2.92 million annual COGS and 30 DPO imply EUR 240,000 payables. In the next year COGS grows to EUR 3.504 million while DPO remains 30; closing AP becomes EUR 288,000. The EUR 48,000 liability increase preserves cash relative to immediate payment.
Use terms that can be supported by purchasing arrangements. A longer target may affect discounts or supply reliability; a past overdue balance is not automatically a sustainable policy. The payables reference documents Amount and Days and available-flow limits.
Reconcile supplier payments to purchases
Without other payable movements, payments = opening AP + purchases − closing AP. In 2026, opening and closing payables are EUR 240,000 while purchases are EUR 2.76 million, so supplier payments equal EUR 2.76 million. The lower purchasing requirement comes from using opening stock.
In 2027, EUR 240,000 opening AP + EUR 3.584 million purchases − EUR 288,000 closing AP gives EUR 3.536 million payments. The preview displays payments as a cash outflow. Its positive AP cash effect is the EUR 48,000 balance increase, not the entire closing liability.
Use explicit balances where terms change
An explicit period-end payable balance can describe a known payment policy or a planned settlement. Reconcile it to opening liabilities and new purchases. A closing target cannot exceed that available total without implying an unsupported supplier cash inflow.
The model is not an invoice-due-date calendar. Use external detail to support an input where necessary, then inspect the product’s payment reconciliation. Distinguish ordinary settlements from write-offs, acquired liabilities and other non-cash movements before attributing a change to cash.
Follow supplier credit into cash generation
Changing DPO at a fixed cost base isolates a timing effect; changing growth or stock policy also changes purchasing. Review both before interpreting supplier credit as an improvement in operating performance. Shorter payment terms can consume cash even when the business remains profitable.
Follow the plan into free cash flow and the cash-flow statement reference. The cash conversion cycle connects supplier days with receivables and stock, but a negative cycle does not establish sufficient total liquidity.
Frequently asked questions
How is this different from a DPO calculator?
A DPO calculator explores supplied balances, flows and day targets. This model carries supplier balances and their payments through future periods.
Does the model use purchases or COGS for DPO?
Its day driver uses annualized positive COGS on a 365-day basis. Purchases still determine supplier cash payments through the stock and payable roll-forward.
Does a payable increase improve profit?
By itself it changes payment timing and the liability, not the recognized operating cost or profit.
Can the target create negative supplier payments?
No. The product limits the target to opening payables plus available purchases.