Financial forecasting models are generally divided into: 1) assumptions; 2) Calculation page and result page. The purpose of financial forecast is to make financial policies, major financial decisions, financing plans, general financial analysis and future financial situation. The company's financial policies generally include:
Credit policy;
Inventory reserve and current occupation;
Construction and purchase of fixed assets;
Plans and measures to reduce costs;
Financing plan and financing cost allocation.
When the company formulates various financial policies, it needs to analyze the influence of various policies on the future financial situation to confirm the influence of various financial policy changes on the company's future finance. Through this comparison, we will clearly understand the obvious financial impact of the company's policy changes.
When designing the financial forecasting model, the assumed conditions generally include: sales revenue, sales cost, sales expenses, management expenses and other accounts receivable. Inventory, accounts receivable, accounts payable, bank deposits, debts, accrued expenses, etc. will be automatically calculated through the model. The final result is three statements, balance sheet, income statement and cash flow statement. If the company needs to forecast the key performance indicators, it can also design them in the forecast model, and generally the following contents can be added:
Key performance indicators (KPI, focusing on financial indicators);
Management decision-making models, such as cost decision, break-even point forecast, credit analysis, liquidity forecast, enterprise economic growth forecast, etc. );
Budget comparison, by comparing the planned forecast data with the actual implementation data, confirm the difference and the reasons for the difference.
Adjustment of financial forecasting model
In the process of financial forecasting, the most important problem is to adjust or modify the financial forecasting model into a model that conforms to the company's situation, which is very important and necessary. We hope that entrepreneurs can understand the future financial situation of enterprises through this forecasting model, so we need to adjust the differences between basic assumptions and hypothetical changes in model design, which include:
Product line adjustment: the product structure of financial forecast can be adjusted according to the management requirements of the current company, for example, the previous forecast by product category can be adjusted according to the product sales area or sales method; If the company is in the form of business divisions, each business division can also become an economic center for forecasting;
The adjustment of cost forecast table can adjust the cost forecast from cost type to product category, and adjust the cost to sales cost according to management requirements, including the classification of variable cost and fixed cost, the calculation of sales quantity and sales price in breakeven point;
In general, we will show the inventory, accounts receivable, accounts payable, fixed assets, bank deposits and negative and financial statements to the managers of the company, but in some companies with specific or other requirements, we need more information than the above. For example, the company is making long-term investment or technical improvement, which requires a lot of long-term investment. The precipitation of these funds will have a far-reaching impact on the company's financial situation. How to arrange a reasonable investment period and investment plan is a headache for every manager. You can design a detailed investment table to reflect the impact of long-term investment on the company.
The financial forecasting model we designed meets the actual management needs of the company. Therefore, when using the financial forecasting model, not all the data obtained or input come from the financial accounting system. Business judgment and career analysis in the process can ensure the validity of the output of financial forecasting model and reflect the future situation. Generally speaking, we call it "analyzing data".