This article focuses on the operational budget’s enhancements for the rolling forecast process and shows 7 possible benefits.

A forecast that simply assigns future values based on prior experiences is not a model. In this article, I elaborate on the meaning of specifying the cause of change by showing why 3-statement forecasting is not enough for FP&A.

Developing predictive models, forecasts and scenarios to assess risk and assist decision making is one of a finance department’s most important activities. If finance managers neglect this activity, the company may encounter serious problems.

Among FP&A challenges understanding, explaining and forecasting revenues evolutions are one of the top items. It may be more or less difficult depending on the company business.

At the third meeting of the AI/ML FP&A Committee, Xena Ugrinsky, Principal and Founder at GenreX, talked about the future of FP&A and some ways of incorporating AI into the financial forecasting process. Also, Xena provided an example explaining how Stanley Black & Decker improved financial forecasting by 60%.

When I first came across the term driver based planning and forecasting I was confused. As an ex-investment banker having joined a Finance team the concept of drivers when talking about a forecast or plan was simply assumptions. Why was it not called just that? Assumptions! Investment bankers have been building models with assumptions ever since the first model was built and a corporate transaction was negotiated.