A standard 13-week cash forecast assumes a relatively simple AR model: invoice → 30-day collection → deposit. Apply that template to a restoration company and it will be wrong by 40–60% in any given week, not because the math is wrong, but because the underlying model of how restoration revenue arrives is wrong.

Here's what actually happens to restoration cash.

The Five Collection Horizons

When you complete a restoration job, you don't get paid once. You get paid across a sequence of events that can span 3–6 months:

1. ACV payment (30–60 days post-invoice). The carrier releases the Actual Cash Value portion of the claim — typically 60–70% of the total approved estimate. This is the first real cash event.

2. TPA reconciliation (30–45 days post-job-close). If the job came through a program, the TPA issues its reconciliation statement and remits minus the takedown fee. This is separate from the carrier payment and arrives on a different schedule.

3. First supplement payment (60–90 days post-supplement approval). Approved supplemental scope gets paid on its own cycle, often with its own deductible and holdback calculations.

4. RCV holdback release (60–120 days post-certificate-of-completion). Recoverable depreciation is released after you provide evidence that the work was completed. The timeline depends on the carrier and the adjuster relationship.

5. Final supplement payments (90–180 days post-completion). Complex supplemental scope — especially on larger jobs — can still be generating payments six months after the crew demobilized.

A generalist bookkeeper's 13-week template has one row for "customer payments." A restoration 13-week template needs five rows, each with a different lag, a different probability of arrival, and a different dollar amount.

Building the Restoration-Specific Template

The template structure we use has three sections:

Inflows (by source type):

Direct carrier ACV payments (by job, expected collection date based on adjuster relationship)
TPA program remittances (by program, based on program's payment cycle)
Supplement payments (by job, by supplement, based on approval date + program-specific lag)
RCV holdback releases (by job, based on certificate of completion date + carrier-specific lag)
Retail/out-of-pocket collections (by invoice, standard 30-day assumption)

Outflows (by category):

Payroll (fixed by pay cycle, known)
Subcontractor payments (by invoice due date, usually Net-15 or Net-30 from job close)
Materials and supplies (by card statement cycle, usually weekly or bi-weekly)
Equipment rental returns (by contract)
Fixed overhead (rent, insurance, software — monthly, known)
Debt service (monthly, known)

Credit availability:

Available line of credit
Outstanding draws
Net available credit (buffer column)

The buffer column is the point of the whole exercise. When a week's outflows exceed inflows and the buffer drops below a minimum threshold, that's a draw event. Seeing it two to four weeks ahead gives you time to manage it — delay a vendor payment, accelerate an AR call, or draw on the line before you need it.

The Assumptions That Make or Break It

The forecast is only as good as the collection timing assumptions. Here's how we calibrate them:

Carrier-specific lags. Every carrier has a different average days-to-payment. Farmers pays differently than Travelers. Homeowners policies pay differently than commercial. Build a rolling average per carrier from 12 months of your own payment history, and use that as your lag assumption — not an industry average.

Supplement approval probability. Not all pending supplements will be approved at the submitted amount. For forecasting purposes, use 70% of submitted supplement value as the expected inflow, based on industry-wide approval rates. If your approval rate is higher or lower from your own history, adjust accordingly.

Holdback timing. RCV holdbacks are the most unpredictable line in the forecast. We use a 90-day lag from the certificate of completion date as a default, with a flag for any job where the holdback is larger than $15K — those get individual tracking because the cash event is material enough to matter.

What This Changes Operationally

The most immediate operational benefit of a restoration-specific 13-week forecast is that it makes line-of-credit draws rational rather than reactive. Companies that lack the forecast draw on their line when cash is low — which is the worst time to draw, because it means you're often at maximum utilization when a payment event arrives and the need drops.

With the forecast, draws are scheduled. You draw when you can see the need coming, typically 3–4 weeks ahead. That keeps utilization lower on average, reduces interest cost, and prevents the scramble-to-payroll scenario that restoration owners describe as the most stressful part of running the business.

The second benefit: it gives you a documented basis for having a frank conversation with your bank. If you go to a banking relationship and say "I need a bigger line because my business needs it," you're asking for faith. If you go with a 13-week model showing five collection types, historical lag assumptions, and a projected minimum cash balance over the next quarter, you're presenting a creditworthy argument.