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Escrow Tracking Worksheet

Figure 5-2

The Escrow Tracking Worksheet informs managers of the total dollar amount that should be available in the escrow account. By following this discipline, bills can be paid when they come due without an owner relying on a busy weekend to meet the expense. If there is not enough cash to fund this account, management can immediately recognize a cash flow problem and take corrective action.

To use this form:

1. Column A lists the different cost areas.
2. Column B is a recurring amount that is either extracted from the budget or based upon trends over the previous few months. The monthly amount can be entered and then divided over the number of weeks in that particular accounting period. In this example, there is a 4-week accounting period.
3. Column C is for any line items that have a previous balance and not paid in the previous month, but are due quarterly.
4. Columns D through H represent the weeks within the present accounting period.
5. Several entries are made weekly when the dollar amount is known. These entries include:
   1. Sales tax is generated weekly and extracted from the sales report;
   2. Employer payroll contributions;
   3. Unemployment taxes.

At the end of each week, the Total Escrow amount should be in the bank ready to pay these bills. If this amount is not in the account or was used for operational purposes, there is a cash flow problem.