Financial Forecasts & Projections
Business entities need to plan for the future; they must also consider alternative management strategies and prepare capital and operating budgets; they must also consider alternative funding and cash budget possibilities. An important part of the planning process is the preparation of prospective financial statements that attempt to predict the outcome of the business entity’s activities in future periods.
Financial forecasts and financial projections are prospective financial statements that present an entity’s expected financial position, results of operations, and cash flows in future periods under two different conditions. Financial forecasts assume that the entity will continue to function in the manner in which it is currently functioning. For example, if the entity is a retail store chain, that it will continue to do business in the manner in which it is currently engaged. The financial forecast presents the predicted results for the next year.
In essence, forecasting and budgeting are a necessity when trying to effectively manage and lead a business to profitability. From simple projections to complex financial modeling, our experienced staff can assist you in achieving your company’s financial goals.