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Financial Forecasts Managers and external users of monetary information be more(prenominal) concerned with what the future holds for an governing than its past history because what has happened has happened and inform systems be incapable of changing history. Financial forecasts on the other had can be used for budgeting as well as planning purposes. The forecasts offer expected results based on past facts. Investors and share holders around the world base their decisions on financial and economic forecasts. Public companies are special at a lower place perpetual pressure to perform according to budgeted expectations and forecasts. Failure to do so results in lower stock prices and financial difficulties. Forecasting comes under the broad subject of prophetic accounting. The four main aspects of predictive accounting are: ? It improves projecting financial performance by monitoring whether assistes are in control. In-control processes are predictable; out-of-control processes are unpredictable. Cant find your paper. Click here to get a custom non-plagiarized term paper from a top interrogation company ? It seeks to understand the future. ? It is based on the premise that the actions of an organization are repeatable processes.

? It uses processes that describe the way the organization works. Financial forecasts tending firms in identifying finance (external and internal) requirements as well as summation requirements. In short financial planning is a process by which firms identify their goals and cost and plan how to meet them. superstar of the main advantages of financial forecasting is that it identifies interactions between various elements of a firm, for example how inventory changes affect finance costs. It also makes profit which financing options are more suitable in the presbyopic term and which ones would cause problems. By incorporating external factors such as the rate of inflation and interest rates in to the forecast, the organization is able to avoid surprises.... If you want to get a skillful essay, order it on our website: Orderessay

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