What is a 13 week cash flow model
As the name suggests, a 13-week cash flow model is a weekly cash flow forecast. The 13 week cash flow uses the direct method to forecast weekly cash receipts less cash disbursements. The forecast is frequently used in turnaround situations when a company enters financial distress in order to provide visibility into the company’s short-term options.
How the 13 week cash flow model is used in practice
In the example below, shutter-maker American Home Products filed this 13 week cash flow (“TWCF”) to support their request for a $400,000 Debtor-in-Possession (DIP) revolver in court:

Source: AHP 5/29/19 DIP Motion. Download the PDF.
AHP’s TWCF shows the company expects to need the additional financing almost immediately on June 7, 2019, followed by a second DIP draw July 5, 2019
While every 13-week cash flow model will show receipts and disbursements that are unique to its business and circumstances, most thirteen week cash flow models follow a generally similar structure:

Structure of a 13 Week Cash Flow Forecast.
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The 13-week cash flow model is a tool for decision making
By identifying the immediate cash flow needs at the most granular level, the model helps distressed firms evaluate the immediate impact of a variety of possible operational, financial, and strategic remedies:
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Why is the TWCF So Important?
A credible TWCF often quite literally is the difference between survival and Chapter 7 liquidation.
The reality for many liquidity-constrained companies under financial distress is that even if they are viable as a going concern in the long run, they must convince prepetition lenders or a third party to extend debtor-in-possession (DIP) financing to bridge to a medium term and ultimately a long term plan. Securing this financing is almost always supported by credible 13-week cash flow forecast.
The TWCF is designed to increase the level of transparency and trust between management, creditors and other stakeholders.

13 Week Cash Flow is a Tool for Decision Making