Businesses generally want a benchmark for all the activities and budgeting and forecasting helps businesses set a financial benchmark. Budgeting and forecasting enables business to understand whether it is performing as expected. It is therefore important component of financial planning and further helps in the decision-making process.
Budgeting allows you to set a limit for every task ensuring you will have enough finance to continue with your operations effortlessly for a particular period. It helps in devising a business plan that will enable to manage monthly, quarterly and annual cash inflows and outflows efficiently. Forecasting where as is all about determining in advance the financial status of the business. It is used to make future financial projections with the help of historical data. It enables to identify trends that are serves as base for comparison.
It is crucial to understand the difference between budgeting and forecasting to be able to perform both the activities with finesse. A simple way of understanding the difference could be that budgeting is preparing a financial planner while forecasting use this exact planner and then predicting whether the company will meet or exceed the expectations from the budget.
No matter what size or the scale of operation of your business is, you have to prepare a budget and forecast plan for a year or so. Let us understand why is it so -
Quarterly, half-yearly or annually budget for the company and its departments
Budget for the entire life of a project that’s helps to control and report cost for a project
Capital Budget to help identify, assess, and plan for a company’s capital needs
Cash Flow Forecasting that helps in identifying budget variances
Avail Whiz Consulting’s outsourced business budgeting and forecasting services today to get an accurate picture of your business in terms of performance.
Whiz Consulting provides budgeting and forecasting services for Indian Businesses. Here is why you should avail our service -