Understanding Cashflow

What is Cashflow?

Cashflow analysis in Caprafi helps you forecast and track the movement of money in and out of your portfolio over time. It provides visibility into:

• Income - Money flowing into your portfolio (dividends, interest, rental income, etc.)
• Expenses - Money flowing out (management fees, taxes, maintenance costs, etc.)
• Investments - Capital deployed into new or existing assets
• Returns - Capital returned from investments (loan repayments, distributions, exits)

Why Track Cashflow?

Understanding your cashflow is essential for effective portfolio management:

• Liquidity Planning - Know when you'll have cash available and when you might need it
• Investment Timing - Plan new investments around expected capital returns
• Expense Management - Track recurring costs and their impact on your portfolio
• Scenario Analysis - Model different outcomes with hypothetical entries
• Performance Insights - Understand the true cash yield of your investments

Scenarios

Cashflow scenarios allow you to model different futures:

• Default Scenario - Your baseline projection based on known facts
• Alternative Scenarios - "What-if" projections for different assumptions
• Comparison View - Side-by-side analysis of different scenarios

Each scenario can have its own set of entries while sharing the same starting balance configuration.

Entry Types Explained

Income

Regular inflows from your investments:

• Dividends from stocks and funds
• Interest from loans and bonds
• Rental income from real estate
• Distribution from private equity

Expense

Costs associated with managing your portfolio:

• Management fees
• Accounting and legal fees
• Insurance premiums
• Property maintenance
• Tax payments

Investment

Capital deployed into assets:

• New asset purchases
• Capital calls from funds
• Additional investments in existing assets
• Property improvements

Return

Capital returned from investments:

• Loan principal repayments
• Fund distributions (return of capital)
• Asset sale proceeds
• Dividend reinvestment redemptions

Recurrence Options

Entries can be one-time or recurring:

• One-time - Single occurrence in the specified month
• Monthly - Repeats every month until the end date
• Quarterly - Repeats every 3 months
• Annually - Repeats every 12 months

For recurring entries, you can optionally set an end date, or leave it open for indefinite recurrence.

Linking Entries

Entries can be linked to specific assets or entities:

• Asset-linked - Track cashflow for specific investments
• Entity-linked - Track cashflow for specific legal entities
• Hypothetical - Model potential future scenarios without linking to real assets

This linking enables powerful analysis:

• See all cashflow for a specific property
• Aggregate cashflow by entity for reporting
• Model acquisitions before they happen

Starting Balance

Your cashflow analysis starts with a configured starting balance:

• Select one or more cash/bank accounts as your baseline
• The system calculates the current balance from each account's transaction history (opening balance plus all deposits, withdrawals, interest, and fees)
• For future years, cumulative cashflow is automatically calculated

This ensures your projections accurately reflect your cash position over time, based on actual transaction data rather than manual valuations.