FORECASTS & PROJECTIONS
Forecasts and projections are the two types of prospective financial statements. Using the numbers that we have now to help predict where your business will be one year or five years down the road can help you plan. It is also an essential part of securing funding.
A forecast is an estimate of future results and is based on assumptions reflecting conditions management expects to exist and the course of actions it expects to take. It can take the form of a specific amount or a range.
A projection presents an entity's expected financial position given one or more hypothetical assumptions. A projection, like a forecast, may contain a range of results based on the hypothetical course of actions. Projections are quite useful if you want to test how a hypothetical course of action, such as changing the product mix of sales or changing price levels, might impact results of operations or financial condition.
GMG CPAs are skilled professionals who will work with you to understand where you are now and where you are headed.