FP&A
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Why a budget is not a spreadsheet exercise
A budget built from numbers falls silent when actuals diverge. A budget built from assumptions explains what changed, and why.
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Why does a five-year business plan need three linked statements?
A business plan built only on the income statement shows profit but hides how much cash and financing that profit requires. A model in which the income statement, balance sheet and cash flow are linked tests the plan’s consistency by itself.
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What is a rolling forecast, and does it replace the annual budget?
A rolling forecast brings actuals into the model every month and re-forecasts the remaining period with up-to-date information. It does not replace the budget; it makes visible the gap between what the budget says and where the company is actually heading.
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How do you carry out scenario and sensitivity analysis?
A plan built on a single number prepares for a future that will not happen. Scenario and sensitivity analysis show how dependent the plan is on each assumption and where the company will struggle if things go wrong.
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Which KPIs belong in a management report?
A good management report does not show a lot; it shows the right things, with the same definitions every month, in a comparable way. Choosing indicators starts with the decisions the company has to make.