Cashflow impact on historical working capital movements

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Sajid Mafahir X 1
Cashflow impact on historical working capital movements

Hello Modano Members,

I'm struggling to understand how the cashflow works for working capital movements.

For example, in my model in the debt section the interest is not actually paid regularly on a monthly basis hence, i changed the formula to input assumption and keeps accruing which impacts the liability and expense part. While the Expense part works correctly the liability and cashflow report assumes the historically accrued balance is settled at once soon as I change my time period to the latest period.  

As a short-term fix, I use the Other Liability section to include the accrued interest value to match with our books due to the fact that the interest is not actually paid, and it artificially blows my cash outflows resulting in an ambiguous cash requirement.

  • while I tried to go in deeper to the formula I realized that once I change the time period to the latest period the historical interest value is not accumulated to the current period resulting the interest to look as it just commenced and the balance sheet value for the historical portion is set to 0, see below Pic001. I had to temporarily add the historical interest value to the other current value to nullify the error, see Pic002



I noticed this pattern in other areas such as debtors balance and also 

is anyone else facing the same issue? Your support is appreciated.