Accurate cash flow tagging is the foundation of reliable runway calculations and financial planning in re:cap. This guide shows you best practices so you can verify that your cash flow data is complete, properly categorized, and ready to give you trustworthy insights.
1. Check the latest Closing Balance
Goal: Make sure all relevant bank accounts are connected and included in re:cap, especially accounts with fewer transactions (like savings accounts).
How to check:
- Go to Cash Flow Statement.
- Look at the latest Closing balance (bottom row).
- Compare it with your internal closing balance (from your banking setup or finance system).
How to interpret the result:
- If the numbers match: All accounts are included.
- If the closing balance is too low or looks off: One or more accounts may be missing or not yet synced.
Commonly missing accounts include:
- Savings accounts
- Payment service providers (PSPs)
- Bank accounts from sister companies
Tipp: Here is how you can connect your bank accounts.
2. Review "Net intracompany cash flow"
Goal: Ensure internal transfers are properly matched and don’t distort operating cash flow.
How to check:
- In the Cash Flow Statement table, find the row Net intracompany cash flow.
- This value should always be 0.
If it’s not 0, internal transfers are likely misclassified or unmatched, often due to:
- Missing bank accounts
- Wrongly classified transactions
Internal transfer tags and what they mean
3. Check Operating and Financing & Investing cash flow
Goal: Verify that business cash flow categories are correct after internal transfers are handled.
Once Net intracompany cash flow is 0, review:
- Net operating cash flow
- Should reflect day-to-day business inflows and outflows (e.g., revenue collections, payroll, rent).
- Net financing & investing cash flow
- Should include external financing and investments (e.g., loans, capital raises, asset purchases).
Note: Compare month-over-month trends Large, unexplained jumps often indicate misclassified transactions (for example: an internal transfer incorrectly tagged as operating cash flow).
Why cash flow tagging is important
Accurate tagging directly impacts your financial insights, especially runway.
Your runway calculation is based on the three-month moving average of operating cash flow. If internal transfers or financing/investing transactions are wrongly tagged as operating cash flow, re:cap will:
- Overestimate or underestimate your burn rate, and
- Distort your runway projection (how many months of cash you have left)
That can lead to incorrect planning, or false confidence in your liquidity.
Note: Correct tagging ensures your runway and performance metrics truly reflect your business operations.
.gif){kind=icon}
