1. The budget is a detailed representation of the future results, financial position, and cash flows that management wants the business to achieve during a certain period of time.
2. Forecast means estimation of future trends and outcomes, based on the past and present data.
3. The budget may only be updated once a year, depending on how frequently senior management wants to revise information.
The forecast is updated at regular intervals, perhaps monthly or quarterly.
4. A budget is an outline of where management wants to take the company. A financial forecast is a report showing whether the company is getting to its budget or not, and where the company is heading.
5. What is it?
Budget:
It is the financial expression of a business plan or target.
FORECAST:
It is the prediction of upcoming events or trends in business, on the basis of present business conditions.
6. There is no variance analysis that compares the forecast to actual results.
The budget is compared to actual results to determine variances from expected performance.
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