In what circumstance might a government entity use a cash-flow budget?

A cash-flow budget is primarily used to project the inflow and outflow of cash over a specific period, which enables an organization to understand its liquidity needs and maintain adequate cash levels. Option C accurately reflects this purpose; it focuses on projecting annual required cash levels, which is essential for a government entity to ensure it has sufficient funds available to meet its obligations throughout the year.

By anticipating cash flow needs, the government can make informed decisions regarding expenditures, savings, and investments, thereby enhancing financial stability. This is particularly vital in a governmental context where cash constraints can impact service delivery and program funding.

In contrast, the other options may not align as closely with the primary use of a cash-flow budget. Long-term investment forecasting typically involves strategic planning rather than short-term cash management. Managing discrepancies in actual versus projected spending usually pertains to budget analysis rather than cash flow projection. Evaluating grant proposals might require different financial assessments focused on benefits and costs, not specifically on cash flow.