Making predictions is an important part of our work as FP&A practitioners. Its importance is due to need but need can be hindered due to incomplete knowledge.
FP&A establishes the foundation for thinking and learning about how processes affect outcomes. These actions can be guided by broad and narrow framing. In order for FP&A to add value toward these actions, it must take an active role in establishing a framework through the chart of accounts.
How can an FP&A practitioner assess the effectiveness of financial reporting processes? This article describes five tips that could be used in order to establish a starting point in the process.
Financial planning can help financial reporting develop insights into profitability, liquidity, and solvency through a chart of accounts. In other words, it helps to assess financial health. The foundation in this effort is a chart of accounts. The effectiveness of a chart of accounts can be achieved by the role of financial planning.
FP&A is a process of thinking and learning about how companies earn income and generate cash flows. In order for this process to be effective a bridge between planning and analysis is necessary. I learned about the importance of this bridge early in my professional life.
How should the role of chance influence the work of FP&A practitioners?
Intentions may lead to results that were not intended. There are times in which good intentions may lead to bad results or an idea that is designed to accomplish one task may succeed by performing a completely different task. As a result, FP&A practitioners should recognize the role of chance in FP&A.
Pagination
Author's Articles
The purpose of a balance sheet is to describe the resources that a business has and how those resources were acquired. This purpose is seen as an end result of financial planning but this purpose can be seen as a starting point of financial planning.
The purpose of an income statement is to describe the delivery of products or the provision of services. This purpose is seen as an end result of Financial Planning but this purpose can be seen as a starting point of Financial Planning. As a starting point of Financial Planning people should think about how to accumulate wealth from the delivery of products or the provision of services.
In 1992 a professor named Robert Kaplan and a consultant named David Norton created a measurement system called The Balanced Scorecard. A reason for creating The Balanced Scorecard was to go beyond financial statements in measuring what businesses do in order to improve performance.
Financial Planning is a process of thinking. One of the end results from this process is a product called a budget. A budget is a product that expresses thoughts. As a product a budget must be created and its creation must have a foundation. The foundation for creating a budget is answers to three basic questions.