Liquidity and Funding Plan Template (Corporate Treasury)

Liquidity and Funding Plan: [Organisation name] [Plan period, e.g. FY2027 to FY2028]

Annual corporate liquidity and funding plan for a non-financial group: liquidity sources, funding needs, the debt maturity profile, headroom against the treasury policy minimum, the refinancing plan, covenant and rating considerations, stress scenarios, contingency funding actions and approvals. Written as original practice guidance for corporate treasurers and boards. It is not a bank contingency funding plan or an internal liquidity adequacy assessment; regulated banks follow prudential rules (see Contingency Funding Plan (finance/contingency-funding-plan) and ILAAP Report (finance/ilaap-report)). Accounting references (IFRS 7, IAS 1, IAS 8, IFRS 18) are cited by name and paragraph number only; obtain the standard or law for the normative text. Replace every [bracketed] value and every row marked Example. This is a document format, not financial, investment, tax, legal or accounting advice.

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Contents

1. Summary and decisions requested
2. Liquidity sources
3. Funding needs
4. Maturity profile
5. Headroom against the policy minimum
6. Refinancing plan
7. Covenants and rating considerations
8. Stress scenarios
9. Contingency funding actions
10. Governance, reporting and accounting links
11. Glossary and references

1. Summary and decisions requested

Example: Corvid Commerce Group starts FY2027 with cash of 28,000 and an undrawn committed revolving credit facility of 20,000, giving liquidity headroom of 47,000 (cash 28,000 less 1,000 held in Vietnam that cannot be remitted or swept, plus the 20,000 facility) against the treasury policy minimum of 35,000. Both the term loan (30,000) and the revolving facility mature on 2028-06-30. Under the treasury policy a facility counts as headroom only while more than 12 months remain to maturity, so the revolving facility stops counting on 2027-06-30. Without refinancing, headroom falls to 25,050 at 2027-06-30 and 24,050 at 2027-09-30, about 10,000 to 11,000 below the minimum, even though trading is on budget. Refinancing both facilities by 2027-06-30 keeps headroom at 48,650 or more in every quarter of the base case and at 38,000 or more in the severe stress case.

1.1 Basis of preparation

Example: The plan starts from the bank balances and facility positions at 2026-12-31, uses the approved FY2027 budget for the first year and the board-endorsed strategic plan for FY2028, and applies the treasury policy approved in [month year]. Amounts are in EUR thousand at budget exchange rates; cash held in other currencies is translated at closing rates. Quarter-end figures are point-in-time; intra-quarter troughs are managed through the 13-week forecast. All facility terms are summarised from the signed agreements; where the plan simplifies a definition (for example net debt), the simplification is stated next to the figure.

The plan deliberately separates three things that are often mixed. Liquidity is the ability to meet payments as they fall due. Funding is the mix and maturity of the long-term money that finances the business. Solvency and capital structure are about how much debt the business can carry over time. This document covers the first two and refers to the third.

2. Liquidity sources

Check: 26,700 + 300 + 20,000 = 47,000; equivalently 28,000 - 1,000 + 20,000 = 47,000, the figure in the Treasury Policy, the 13-week forecast and the covenant certificate.

2.1 Cash location and mobility

Check: 14,900 + 3,200 + 3,000 + 5,600 + 1,300 = 28,000. The holding line is the EUR cash pool header account of Corvid Commerce Group plc.

Trapped cash is cash that cannot reach the place where it is needed. Of the Vietnam balance (1,300), the group treats 1,000 as trapped: Corvid Commerce Vietnam LLC (CC-VN) cannot remit or sweep it to the group under local rules (check local law), so it is deducted from headroom in every quarter of the plan, as in the Treasury Policy (finance/treasury-policy) and the 13-week forecast. The remaining 300 is spent locally on CC-VN's own obligations (the 13-week forecast shows CC-VN paying out 2,400 against receipts of 1,600 over the quarter, with a group transfer in). Review the trapped amount each quarter with the local finance lead.

2.2 What does not count as liquidity

Be strict about what the plan treats as available. Uncommitted overdrafts and money market lines can be withdrawn exactly when they are needed, so they are excluded. Cash held as collateral, in escrow or as a regulatory deposit is excluded. Cash in countries with remittance restrictions is shown separately; any part above that country's own payment needs is trapped and excluded, and in stress cases the plan assumes it stays where it is. Undrawn facilities count only while the borrower can satisfy the drawing conditions and while enough time remains to maturity under the policy rule. Expected proceeds from asset sales, tax refunds or new financing count only once contracted. Applying these rules consistently is what makes the headroom figure meaningful to the board and to lenders.

3. Funding needs

Check FY2027: 21,600 - 2,100 - 3,300 - 12,000 - 1,200 - 1,600 - 3,000 - 400 = -2,000; 28,000 - 2,000 = 26,000. The approved budget closes at 26,400 before refinancing fees; this plan adds the 400 fees. Check FY2028: 25,000 - 1,500 - 3,800 - 12,500 - 1,300 - 1,500 - 3,500 = 900; 26,000 + 900 = 26,900.

Free cash flow before dividends and refinancing fees in FY2027 is 21,600 - 2,100 - 3,300 - 12,000 - 1,200 - 1,600 = 1,400; the dividend (3,000) is therefore funded partly from cash on hand. The board should see that explicitly when it approves the dividend.

3.1 Notes on the funding needs

Read the sources and uses table from top to bottom. Operating cash flow after tax funds capital expenditure in both years, but only narrowly in FY2027, and the dividend draws on cash already held. That is acceptable while headroom is well above the minimum and leverage is low, but it means the plan is sensitive to any shortfall in EBITDA or to capex overruns. The board should see three figures alongside the table: free cash flow before dividends, the share of capex that is committed (and therefore cannot be cut quickly), and the working capital assumption, because those are the levers that decide whether the plan holds.

For a business with significant seasonality, add a column for the peak funding requirement within the year, taken from the monthly cash forecast. Facilities must be sized for the peak, not the year-end.

4. Maturity profile

4.1 Before refinancing (at 2026-12-31)

Check: 1,600 + 31,500 + 1,400 + 3,500 = 38,000; leases 1,600 + 1,500 + 1,400 + 3,500 = 8,000, the carrying amount at 2026-12-31 used in Going Concern Assessment (finance/going-concern-assessment). Lease liabilities are shown at their carrying amounts by year of principal repayment; IFRS 7 paragraph 39 asks for a maturity analysis of financial liabilities based on contractual undiscounted cash flows in the financial statements, which will include interest and therefore differ from this table.

4.2 After the proposed refinancing (pro forma at 2027-06-30)

Check: 800 + 1,500 + 1,400 + 33,500 = 37,200; leases 8,000 - 800 repaid in H1 2027 = 7,200 (400 a quarter, as in the going-concern base case).

4.3 Maturity metrics

At 2026-12-31 all three maturity metrics breach the illustrative policy; that is the trigger for the refinancing in section 6.

The limits in the policy column are illustrative. Maturity limits are set in the treasury policy, and organisations express them in different ways (a share of debt within 12, 18 or 24 months, a minimum average life, or a cap per calendar year). Copy the metrics and limits from your own Treasury Policy (finance/treasury-policy) and use the same ones in Going Concern Assessment (finance/going-concern-assessment) and Capital Structure and Dividend Policy (finance/capital-structure-dividend-policy), so that the board does not see three versions of the same test.

5. Headroom against the policy minimum

where $C_q$ is quarter-end unrestricted cash, $T_q$ trapped cash (1,000 in every quarter of the example, see section 2.1), $U_{f,q}$ the undrawn commitment of facility $f$, and $H^{\min}$ the policy minimum (35,000 in the example). The strict inequality matters: on 2027-06-30 FAC-002 has exactly 12 months left and no longer counts.

5.1 Base case with refinancing signed on 2027-06-30

Q1 2027 cash is the closing balance of the 13-week forecast CF13-2027-01 (week ending 2027-04-02), used as a quarter-end proxy. Q2 to Q4 2027 cash is the going-concern base case (26,050, 25,050 and 26,400) less the 400 refinancing fees paid in Q2; Q2 also carries the dividend (3,000). Q4 2027 and Q4 2028 agree to section 3. The lowest point is Q3 2027, after the dividend and before the strong fourth trading quarter.

5.2 Without refinancing

Without the 400 refinancing fees, cash is 400 higher than in section 5.1 from Q2 onwards. Check Q2: 25,650 + 400 = 26,050; 26,050 - 1,000 = 25,050; 25,050 - 35,000 = -9,950. Q3: 24,650 + 400 = 25,050; 24,050; -10,950. Q4: 26,000 + 400 = 26,400; 25,400; -9,600. The Q4 figure (25,400) is the 'not refinanced' year-end headroom in the Annual Budget, against 45,400 if refinanced (26,400 - 1,000 + 20,000 under ASM-013).

Two consequences follow. First, the weekly forecast shows the same cliff: every 13-week cycle whose horizon reaches the week ending 2027-07-02 (from cycle CF13-2027-14 onwards) must drop FAC-002 from headroom unless the new facilities are signed. Second, a going-concern assessment or budget that shows FAC-002 in headroom after 2027-06-29 is only valid if it states that it assumes the refinancing; without that label it overstates liquidity by 20,000.

6. Refinancing plan

6.1 Options considered

6.2 Parameters delegated by the board

6.3 Timetable

6.4 Lender relationships and documentation points

Choose lenders that will support the group in a downturn, not only those offering the lowest margin on the day. Spread facilities across banks so that no single bank holds more than [40]% of committed lines, and check the credit quality of each bank under the counterparty limits in Treasury Policy (finance/treasury-policy). Give relationship banks a fair share of ancillary business (cash management, foreign exchange, hedging) in proportion to their commitment; this is how relationship lending is sustained.

During documentation, focus legal and treasury review on the terms that affect liquidity in stress rather than in normal times: the conditions to drawing the revolving facility (repeating representations, the material adverse change clause, if any), the definitions used in the financial covenants and how leases, supplier finance and exceptional items are treated, equity cure rights, the information undertakings (frequency, content and deadlines), restrictions on dividends and acquisitions, and the events of default and their grace periods. A facility that cannot be drawn when it is needed is not liquidity.

7. Covenants and rating considerations

Check: covenant net debt at 2027-12-31 = term loan 30,000 + lease liabilities 6,400 (8,000 less 1,600 repaid in FY2027) - freely available cash 25,000 (cash 26,000 less the 1,000 trapped in Vietnam) = 11,400; 11,400 / 21,600 = 0.528, shown 0.53x; 11,400 / 3.00 = 3,800 and 1 - 3,800 / 21,600 = 82.4%. Stress: 30,000 + 6,400 - (14,000 - 1,000) = 23,400; 23,400 / 15,600 = 1.500, shown 1.50x. Interest cover: 4.00 x 1,200 = 4,800 and 1 - 4,800 / 21,600 = 77.8%. The covenant definition in the example includes lease liabilities, as in Going Concern Assessment (finance/going-concern-assessment), which shows 0.51x at the same date before the 400 refinancing fees (30,000 + 6,400 - 25,400 = 11,000; 11,000 / 21,600). Annual Budget (finance/annual-budget) reports 0.17x on a management definition that excludes leases (3,600 / 21,600); label which definition each figure uses. Formal tests are documented in Covenant Compliance Certificate (finance/covenant-compliance-certificate).

Interest cover is the tighter covenant in this example: EBITDA would have to fall by 77.8% to breach it, against 82.4% for leverage. Both cushions are far larger than the severe stress, so for Corvid the binding constraint is liquidity headroom against the policy minimum and the refinancing date, not the covenants.

Rating considerations (Example): Corvid has no public credit rating. Relationship banks assign internal ratings that drive pricing; they focus on leverage, free cash flow after dividends, liquidity headroom, maturity concentration and customer concentration. If a public rating is pursued later, prepare the same metrics on the agency's published definitions and agree adjustments (leases, supplier finance, pensions) in advance.

8. Stress scenarios

8.1 Scenario design

Design each scenario around a story the board can recognise, then translate it into the drivers of the cash forecast: revenue and margin, working capital days, capex commitments, funding market access and counterparty behaviour. Use the risk register to choose the stories, so that the plan tests the risks the organisation actually faces. Apply the scenario over the full horizon and include the second-order effects: lower revenue usually reduces payables as well as receivables; a downturn makes suppliers ask for shorter terms; a market shock can close the refinancing window at exactly the moment it is needed.

Do not include management actions in the scenario results. Show the unmitigated outcome first, then the actions in section 9 and their effect separately, so the board can judge whether the actions are realistic.

Checks (every quarter deducts the 1,000 of trapped cash): S1 by quarter: Q1 30,550 - 500 - 1,000 + 20,000 = 49,050; Q2 25,650 - 4,000 - 1,000 + 25,000 = 45,650; Q3 24,650 - 8,000 - 1,000 + 25,000 = 40,650; Q4 26,000 - 12,000 - 1,000 + 25,000 = 38,000. The S1 cash shortfall of 12,000 by Q4 is the EBITDA shortfall (21,600 - 15,600 = 6,000), receivables up about 4,100 (10 extra days at about 411 a day of stressed revenue of roughly 150,000) and about 1,900 of inventory and supplier-term effects, with no tax relief assumed. S2: Q2 25,050 and Q3 24,050 from section 5.2; Q4 26,000 - 1,000 + 25,000 = 50,000 once signed. S3: Q3 48,650 - 2,100 = 46,550; Q4 50,000 - 2,100 = 47,900. S4: Q3 40,650 - 2,100 = 38,550; Q4 38,000 - 2,100 = 35,900. RS: 48,650 - 35,000 = 13,650 at Q3; 50,000 - 35,000 = 15,000 at Q4.

The S2 outcome is the most important finding: liquidity depends on the timing of the refinancing more than on trading. The fallback (MS-007) and the early start of the process are the mitigations.

9. Contingency funding actions

9.1 Trigger ladder

9.2 Actions

Order of use: level 1 before level 2, and level 3 only when level 1 and 2 actions are insufficient. Do not count level 3 actions in the stress results.

9.3 Communication in a liquidity event

Prepare the communication plan before it is needed. If a Red trigger fires, the CFO informs the board chair and the audit committee chair first, then the lead relationship bank, then other lenders, in that order and within days rather than weeks. Lenders respond better to early, factual information with a credible plan than to late surprises. Assign one spokesperson for lenders, keep a log of every commitment made to them, and align internal messages so that employees, suppliers and customers hear a consistent account. Listed companies must also consider their disclosure obligations for inside information (for a London-listed company, the UK Market Abuse Regulation, Article 17; for American Depositary Shares, the US exchange and SEC rules as well); involve legal counsel from the first day.

10. Governance, reporting and accounting links

10.1 Monitoring and reporting

10.2 Accounting and reporting links

Example: if FAC-001 were not refinanced by 2027-12-31, the 30,000 term loan would be presented as current in the FY2027 statements and the going-concern assessment would need to address the maturity explicitly. Signing by 2027-06-30 avoids both.

11. Glossary and references

11.1 Glossary

11.2 References

Standard and licence note

Structure aligned with common corporate treasury practice for annual liquidity and funding plans; no standard prescribes the format. IFRS 7, IAS 1, IAS 7, IAS 8, IFRS 18, the UK Corporate Governance Code 2024 and the guidance of the Association of Corporate Treasurers are cited by name and paragraph or provision number only; no text from them is reproduced. This is not a regulatory contingency funding plan for banks. Corvid Commerce Group, its facilities and every figure are fictional. This template is original text written for this collection. Check the current versions of cited standards and the terms of your own facility agreements before use. Template licence: MIT.