Hi All,

I have been struggling with estimating/forecasting trade creditors for next three months. I can estimate direct costs for next three months, but unable to estimate total expenses. So can't work out trade creditors. 

What would be an appropriate way to forecast trade creditors? Should I calculate indirect overhead ratio - and then multiply that to estimated direct cost of the month to get the expenses of the month? Then I can multiply the average creditors day to give me... 

I am creating an excel template for it, so I would just have to refresh it to give me the forecast. The outstanding invoices are downloaded from the database, then using creditor days of the suppliers I worked out when those invoices will be paid, added the direct costs when they are likely to occur and when those direct costs will be paid, so it would give a trade creditors balance at any date. I just need to add the admin/indirect expenses.   

Or have I got it all wrong. Any links or any suggestions would be really helpful.

Thanks,