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How to Write a Great Business Plan: Financial Analysis

The last article in a comprehensive series to help you craft the perfect business plan for your startup.

How to Write a Great Business Plan: Financial Analysis

This article is part of a series on how to write a great business plan .

Numbers tell the story. Bottom line results indicate the success or failure of any business.

Financial projections and estimates help entrepreneurs, lenders, and investors or lenders objectively evaluate a company's potential for success. If a business seeks outside funding, providing comprehensive financial reports and analysis is critical.

But most importantly, financial projections tell you whether your business has a chance of being viable--and if not let you know you have more work to do.

Most business plans include at least five basic reports or projections:

Balance Sheet: Describes the company cash position including assets, liabilities, shareholders, and earnings retained to fund future operations or to serve as funding for expansion and growth. It indicates the financial health of a business.
Income Statement: Also called a Profit and Loss statement, this report lists projected revenue and expenses. It shows whether a company will be profitable during a given time period.
Cash Flow Statement: A projection of cash receipts and expense payments. It shows how and when cash will flow through the business; without cash, payments (including salaries) cannot be made.
Operating Budget: A detailed breakdown of income and expenses; provides a guide for how the company will operate from a "dollars" point of view.
Break-Even Analysis: A projection of the revenue required to cover all fixed and variable expenses. Shows when, under specific conditions, a business can expect to become profitable.

It's easy to find examples of all of the above. Even the most basic accounting software packages include templates and samples. You can also find templates in Excel and Google Docs. (A quick search like "google docs profit and loss statement" yields plenty of examples.)

Or you can work with an accountant to create the necessary financial projections and documents. Certainly feel free to do so... but I'd first recommend playing around with the reports yourself. While you don't need to be an accountant to run a business, you do need to understand your numbers... and the best way to understand your numbers is usually to actually work with your numbers.

But ultimately the tools you use to develop your numbers are not as important as whether those numbers are as accurate as possible--and whether those numbers help you decide whether to take the next step and put your business plan into action.

Then Financial Analysis can help you answer the most important business question: "Can we make a profit?"

Some business plans include less essential but potentially important information in an Appendix section. You may decide to include, as backup or additional information:

Resumes of key leaders
Additional descriptions of products and services
Legal agreements
Organizational charts
Examples of marketing and advertising collateral
Photographs of potential facilities, products, etc
Backup for market research or competitive analysis
Additional financial documents or projections

Keep in mind creating an Appendix is usually only necessary if you're seeking financing or hoping to bring in partners or investors. Initially the people reading your business plan don't wish to plow through reams and reams of charts, numbers, and backup information. If one does want to dig deeper, fine--he or she can check out the documents in the Appendix.

That way your business plan can share your story clearly and concisely.

Otherwise, since you created your business plan... you should already have the backup.

And one last thing: always remember the goal of your business plan is to convince you that your idea makes sense--because it's your time, your money, and your effort on the line.

How to Prepare a Financial Plan for Startup Business (w/ example)

Free Financial Statements Template

Ajay Jagtap

December 7, 2023

13 Min Read

If someone were to ask you about your business financials, could you give them a detailed answer?

Let’s say they ask—how do you allocate your operating expenses? What is your cash flow situation like? What is your exit strategy? And a series of similar other questions.

Instead of mumbling what to answer or shooting in the dark, as a founder, you must prepare yourself to answer this line of questioning—and creating a financial plan for your startup is the best way to do it.

A business plan’s financial plan section is no easy task—we get that.

But, you know what—this in-depth guide and financial plan example can make forecasting as simple as counting on your fingertips.

Ready to get started? Let’s begin by discussing startup financial planning.

What is Startup Financial Planning?

Startup financial planning, in simple terms, is a process of planning the financial aspects of a new business. It’s an integral part of a business plan and comprises its three major components: balance sheet, income statement, and cash-flow statement.

Apart from these statements, your financial section may also include revenue and sales forecasts, assets & liabilities, break-even analysis , and more. Your first financial plan may not be very detailed, but you can tweak and update it as your company grows.

Key Takeaways

Realistic assumptions, thorough research, and a clear understanding of the market are the key to reliable financial projections.
Cash flow projection, balance sheet, and income statement are three major components of a financial plan.
Preparing a financial plan is easier and faster when you use a financial planning tool.
Exploring “what-if” scenarios is an ideal method to understand the potential risks and opportunities involved in the business operations.

Why is Financial Planning Important to Your Startup?

Poor financial planning is one of the biggest reasons why most startups fail. In fact, a recent CNBC study reported that running out of cash was the reason behind 44% of startup failures in 2022.

A well-prepared financial plan provides a clear financial direction for your business, helps you set realistic financial objectives, create accurate forecasts, and shows your business is committed to its financial objectives.

It’s a key element of your business plan for winning potential investors. In fact, YC considered recent financial statements and projections to be critical elements of their Series A due diligence checklist .

Your financial plan demonstrates how your business manages expenses and generates revenue and helps them understand where your business stands today and in 5 years.

Makes sense why financial planning is important to your startup or small business, doesn’t it? Let’s cut to the chase and discuss the key components of a startup’s financial plan.

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Key Components of a Startup Financial Plan

Whether creating a financial plan from scratch for a business venture or just modifying it for an existing one, here are the key components to consider including in your startup’s financial planning process.

Income Statement

An Income statement , also known as a profit-and-loss statement(P&L), shows your company’s income and expenditures. It also demonstrates how your business experienced any profit or loss over a given time.

Consider it as a snapshot of your business that shows the feasibility of your business idea. An income statement can be generated considering three scenarios: worst, expected, and best.

Your income or P&L statement must list the following:

Cost of goods or cost of sale
Gross margin
Operating expenses
Revenue streams
EBITDA (Earnings before interest, tax, depreciation , & amortization )

Established businesses can prepare annual income statements, whereas new businesses and startups should consider preparing monthly statements.

Cash flow Statement

A cash flow statement is one of the most critical financial statements for startups that summarize your business’s cash in-and-out flows over a given time.

This section provides details on the cash position of your business and its ability to meet monetary commitments on a timely basis.

Your cash flow projection consists of the following three components:

✅ Cash revenue projection: Here, you must enter each month’s estimated or expected sales figures.

✅ Cash disbursements: List expenditures that you expect to pay in cash for each month over one year.

✅ Cash flow reconciliation: Cash flow reconciliation is a process used to ensure the accuracy of cash flow projections. The adjusted amount is the cash flow balance carried over to the next month.

Furthermore, a company’s cash flow projections can be crucial while assessing liquidity, its ability to generate positive cash flows and pay off debts, and invest in growth initiatives.

Balance Sheet

Your balance sheet is a financial statement that reports your company’s assets, liabilities, and shareholder equity at a given time.

Consider it as a snapshot of what your business owns and owes, as well as the amount invested by the shareholders.

This statement consists of three parts: assets , liabilities, and the balance calculated by the difference between the first two. The final numbers on this sheet reflect the business owner’s equity or value.

Balance sheets follow the following accounting equation with assets on one side and liabilities plus Owner’s equity on the other:

Here is what’s the core purpose of having a balance-sheet:

Indicates the capital need of the business
It helps to identify the allocation of resources
It calculates the requirement of seed money you put up, and
How much finance is required?

Since it helps investors understand the condition of your business on a given date, it’s a financial statement you can’t miss out on.

Break-even Analysis

Break-even analysis is a startup or small business accounting practice used to determine when a company, product, or service will become profitable.

For instance, a break-even analysis could help you understand how many candles you need to sell to cover your warehousing and manufacturing costs and start making profits.

Remember, anything you sell beyond the break-even point will result in profit.

You must be aware of your fixed and variable costs to accurately determine your startup’s break-even point.

Fixed costs: fixed expenses that stay the same no matter what.
Variable costs: expenses that fluctuate over time depending on production or sales.

A break-even point helps you smartly price your goods or services, cover fixed costs, catch missing expenses, and set sales targets while helping investors gain confidence in your business. No brainer—why it’s a key component of your startup’s financial plan.

Having covered all the key elements of a financial plan, let’s discuss how you can create a financial plan for your startup or small business.

How to Create a Financial Section of a Startup Business Plan?

1. determine your financial needs.

You can’t start financial planning without understanding your financial requirements, can you? Get your notepad or simply open a notion doc; it’s time for some critical thinking.

Start by assessing your current situation by—calculating your income, expenses , assets, and liabilities, what the startup costs are, how much you have against them, and how much financing you need.

Assessing your current financial situation and health will help determine how much capital you need for your small business and help plan fundraising activities and outreach.

Furthermore, determining financial needs helps prioritize operational activities and expenses, effectively allocate resources, and increase the viability and sustainability of a business in the long run.

Having learned to determine financial needs, let’s head straight to setting financial goals.

2. Define Your Financial Goals

Setting realistic financial goals is fundamental in preparing an effective financial plan for your business plan. So, it would help to outline your long-term strategies and goals at the beginning of your financial planning process.

Let’s understand it this way—if you are a SaaS startup pursuing VC financing rounds, you may ask investors about what matters to them the most and prepare your financial plan accordingly.

However, a coffee shop owner seeking a business loan may need to create a plan that appeals to banks, not investors. At the same time, an internal financial plan designed to offer financial direction and resource allocation may not be the same as previous examples, seeing its different use case.

Feeling overwhelmed? Just define your financial goals—you’ll be fine.

You can start by identifying your business KPIs (key performance indicators); it would be an ideal starting point.

3. Choose the Right Financial Planning Tool

Let’s face it—preparing a financial plan using Excel is no joke. One would only use this method if they had all the time in the world.

Having the right financial planning software will simplify and speed up the process and guide you through creating accurate financial forecasts.

Many financial planning software and tools claim to be the ideal solution, but it’s you who will identify and choose a tool that is best for your financial planning needs.

Create a Financial Plan with Upmetrics in no time

Enter your Financial Assumptions, and we’ll calculate your monthly/quarterly and yearly financial projections.

Start Forecasting

4. Make Assumptions Before Projecting Financials

Once you have a financial planning tool, you can move forward to the next step— making financial assumptions for your plan based on your company’s current performance and past financial records.

You’re just making predictions about your company’s financial future, so there’s no need to overthink or complicate the process.

You can gather your business’ historical financial data, market trends, and other relevant documents to help create a base for accurate financial projections.

After you have developed rough assumptions and a good understanding of your business finances, you can move forward to the next step—projecting financials.

5. Prepare Realistic Financial Projections

It’s a no-brainer—financial forecasting is the most critical yet challenging aspect of financial planning. However, it’s effortless if you’re using a financial planning software.

Upmetrics’ forecasting feature can help you project financials for up to 7 years. However, new startups usually consider planning for the next five years. Although it can be contradictory considering your financial goals and investor specifications.

Following are the two key aspects of your financial projections:

Revenue Projections

In simple terms, revenue projections help investors determine how much revenue your business plans to generate in years to come.

It generally involves conducting market research, determining pricing strategy , and cash flow analysis—which we’ve already discussed in the previous steps.

The following are the key components of an accurate revenue projection report:

Market analysis
Sales forecast
Pricing strategy
Growth assumptions
Seasonal variations

This is a critical section for pre-revenue startups, so ensure your projections accurately align with your startup’s financial model and revenue goals.

Expense Projections

Both revenue and expense projections are correlated to each other. As revenue forecasts projected revenue assumptions, expense projections will estimate expenses associated with operating your business.

Accurately estimating your expenses will help in effective cash flow analysis and proper resource allocation.

These are the most common costs to consider while projecting expenses:

Fixed costs
Variable costs
Employee costs or payroll expenses
Operational expenses
Marketing and advertising expenses
Emergency fund

Remember, realistic assumptions, thorough research, and a clear understanding of your market are the key to reliable financial projections.

6. Consider “What if” Scenarios

After you project your financials, it’s time to test your assumptions with what-if analysis, also known as sensitivity analysis.

Using what-if analysis with different scenarios while projecting your financials will increase transparency and help investors better understand your startup’s future with its best, expected, and worst-case scenarios.

Exploring “what-if” scenarios is the best way to better understand the potential risks and opportunities involved in business operations. This proactive exercise will help you make strategic decisions and necessary adjustments to your financial plan.

7. Build a Visual Report

If you’ve closely followed the steps leading to this, you know how to research for financial projections, create a financial plan, and test assumptions using “what-if” scenarios.

Now, we’ll prepare visual reports to present your numbers in a visually appealing and easily digestible format.

Don’t worry—it’s no extra effort. You’ve already made a visual report while creating your financial plan and forecasting financials.

Check the dashboard to see the visual presentation of your projections and reports, and use the necessary financial data, diagrams, and graphs in the final draft of your financial plan.

Here’s what Upmetrics’ dashboard looks like:

Upmetrics financial projections visual report

8. Monitor and Adjust Your Financial Plan

Even though it’s not a primary step in creating a good financial plan for your small business, it’s quite essential to regularly monitor and adjust your financial plan to ensure the assumptions you made are still relevant, and you are heading in the right direction.

There are multiple ways to monitor your financial plan.

For instance, you can compare your assumptions with actual results to ensure accurate projections based on metrics like new customers acquired and acquisition costs, net profit, and gross margin.

Consider making necessary adjustments if your assumptions are not resonating with actual numbers.

Also, keep an eye on whether the changes you’ve identified are having the desired effect by monitoring their implementation.

And that was the last step in our financial planning guide. However, it’s not the end. Have a look at this financial plan example.

Startup Financial Plan Example

Having learned about financial planning, let’s quickly discuss a coffee shop startup financial plan example prepared using Upmetrics.

Important Assumptions

The sales forecast is conservative and assumes a 5% increase in Year 2 and a 10% in Year 3.
The analysis accounts for economic seasonality – wherein some months revenues peak (such as holidays ) and wanes in slower months.
The analysis assumes the owner will not withdraw any salary till the 3rd year; at any time it is assumed that the owner’s withdrawal is available at his discretion.
Sales are cash basis – nonaccrual accounting
Moderate ramp- up in staff over the 5 years forecast
Barista salary in the forecast is $36,000 in 2023.
In general, most cafes have an 85% gross profit margin
In general, most cafes have a 3% net profit margin

Projected Balance Sheet

Projected Cash-Flow Statement

Projected Profit & Loss Statement

Break Even Analysis

Start Preparing Your Financial Plan

We covered everything about financial planning in this guide, didn’t we? Although it doesn’t fulfill our objective to the fullest—we want you to finish your financial plan.

Sounds like a tough job? We have an easy way out for you—Upmetrics’ financial forecasting feature. Simply enter your financial assumptions, and let it do the rest.

So what are you waiting for? Try Upmetrics and create your financial plan in a snap.

Build your Business Plan Faster

with step-by-step Guidance & AI Assistance.

Frequently Asked Questions

How often should i update my financial projections.

Well, there is no particular rule about it. However, reviewing and updating your financial plan once a year is considered an ideal practice as it ensures that the financial aspirations you started and the projections you made are still relevant.

How do I estimate startup costs accurately?

You can estimate your startup costs by identifying and factoring various one-time, recurring, and hidden expenses. However, using a financial forecasting tool like Upmetrics will ensure accurate costs while speeding up the process.

What financial ratios should startups pay attention to?

Here’s a list of financial ratios every startup owner should keep an eye on:

Net profit margin
Current ratio
Quick ratio
Working capital
Return on equity
Debt-to-equity ratio
Return on assets
Debt-to-asset ratio

What are the 3 different scenarios in scenario analysis?

As discussed earlier, Scenario analysis is the process of ascertaining and analyzing possible events that can occur in the future. Startups or small businesses often consider analyzing these three scenarios:

base-case (expected) scenario
Worst-case scenario
best case scenario.

About the Author

Ajay is a SaaS writer and personal finance blogger who has been active in the space for over three years, writing about startups, business planning, budgeting, credit cards, and other topics related to personal finance. If not writing, he’s probably having a power nap. Read more

Reach Your Goals with Accurate Planning

Free Financial Templates for a Business Plan

By Andy Marker | July 29, 2020

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In this article, we’ve rounded up expert-tested financial templates for your business plan, all of which are free to download in Excel, Google Sheets, and PDF formats.

Included on this page, you’ll find the essential financial statement templates, including income statement templates , cash flow statement templates , and balance sheet templates . Plus, we cover the key elements of the financial section of a business plan .

Financial Plan Templates

Download and prepare these financial plan templates to include in your business plan. Use historical data and future projections to produce an overview of the financial health of your organization to support your business plan and gain buy-in from stakeholders

Business Financial Plan Template

Use this financial plan template to organize and prepare the financial section of your business plan. This customizable template has room to provide a financial overview, any important assumptions, key financial indicators and ratios, a break-even analysis, and pro forma financial statements to share key financial data with potential investors.

Download Financial Plan Template

Word | PDF | Smartsheet

Financial Plan Projections Template for Startups

This financial plan projections template comes as a set of pro forma templates designed to help startups. The template set includes a 12-month profit and loss statement, a balance sheet, and a cash flow statement for you to detail the current and projected financial position of a business.

‌ Download Startup Financial Projections Template

Excel | Smartsheet

Income Statement Templates for Business Plan

Also called profit and loss statements , these income statement templates will empower you to make critical business decisions by providing insight into your company, as well as illustrating the projected profitability associated with business activities. The numbers prepared in your income statement directly influence the cash flow and balance sheet forecasts.

Pro Forma Income Statement/Profit and Loss Sample

Use this pro forma income statement template to project income and expenses over a three-year time period. Pro forma income statements consider historical or market analysis data to calculate the estimated sales, cost of sales, profits, and more.

‌ Download Pro Forma Income Statement Sample - Excel

Small Business Profit and Loss Statement

Small businesses can use this simple profit and loss statement template to project income and expenses for a specific time period. Enter expected income, cost of goods sold, and business expenses, and the built-in formulas will automatically calculate the net income.

‌ Download Small Business Profit and Loss Template - Excel

3-Year Income Statement Template

Use this income statement template to calculate and assess the profit and loss generated by your business over three years. This template provides room to enter revenue and expenses associated with operating your business and allows you to track performance over time.

Download 3-Year Income Statement Template

For additional resources, including how to use profit and loss statements, visit “ Download Free Profit and Loss Templates .”

Cash Flow Statement Templates for Business Plan

Use these free cash flow statement templates to convey how efficiently your company manages the inflow and outflow of money. Use a cash flow statement to analyze the availability of liquid assets and your company’s ability to grow and sustain itself long term.

Simple Cash Flow Template

Use this basic cash flow template to compare your business cash flows against different time periods. Enter the beginning balance of cash on hand, and then detail itemized cash receipts, payments, costs of goods sold, and expenses. Once you enter those values, the built-in formulas will calculate total cash payments, net cash change, and the month ending cash position.

Download Simple Cash Flow Template

12-Month Cash Flow Forecast Template

Use this cash flow forecast template, also called a pro forma cash flow template, to track and compare expected and actual cash flow outcomes on a monthly and yearly basis. Enter the cash on hand at the beginning of each month, and then add the cash receipts (from customers, issuance of stock, and other operations). Finally, add the cash paid out (purchases made, wage expenses, and other cash outflow). Once you enter those values, the built-in formulas will calculate your cash position for each month with.

‌ Download 12-Month Cash Flow Forecast

3-Year Cash Flow Statement Template Set

Use this cash flow statement template set to analyze the amount of cash your company has compared to its expenses and liabilities. This template set contains a tab to create a monthly cash flow statement, a yearly cash flow statement, and a three-year cash flow statement to track cash flow for the operating, investing, and financing activities of your business.

Download 3-Year Cash Flow Statement Template

For additional information on managing your cash flow, including how to create a cash flow forecast, visit “ Free Cash Flow Statement Templates .”

Balance Sheet Templates for a Business Plan

Use these free balance sheet templates to convey the financial position of your business during a specific time period to potential investors and stakeholders.

Small Business Pro Forma Balance Sheet

Small businesses can use this pro forma balance sheet template to project account balances for assets, liabilities, and equity for a designated period. Established businesses can use this template (and its built-in formulas) to calculate key financial ratios, including working capital.

Download Pro Forma Balance Sheet Template

Monthly and Quarterly Balance Sheet Template

Use this balance sheet template to evaluate your company’s financial health on a monthly, quarterly, and annual basis. You can also use this template to project your financial position for a specified time in the future. Once you complete the balance sheet, you can compare and analyze your assets, liabilities, and equity on a quarter-over-quarter or year-over-year basis.

Download Monthly/Quarterly Balance Sheet Template - Excel

Yearly Balance Sheet Template

Use this balance sheet template to compare your company’s short and long-term assets, liabilities, and equity year-over-year. This template also provides calculations for common financial ratios with built-in formulas, so you can use it to evaluate account balances annually.

Download Yearly Balance Sheet Template - Excel

For more downloadable resources for a wide range of organizations, visit “ Free Balance Sheet Templates .”

Sales Forecast Templates for Business Plan

Sales projections are a fundamental part of a business plan, and should support all other components of your plan, including your market analysis, product offerings, and marketing plan . Use these sales forecast templates to estimate future sales, and ensure the numbers align with the sales numbers provided in your income statement.

Basic Sales Forecast Sample Template

Use this basic forecast template to project the sales of a specific product. Gather historical and industry sales data to generate monthly and yearly estimates of the number of units sold and the price per unit. Then, the pre-built formulas will calculate percentages automatically. You’ll also find details about which months provide the highest sales percentage, and the percentage change in sales month-over-month.

Download Basic Sales Forecast Sample Template

12-Month Sales Forecast Template for Multiple Products

Use this sales forecast template to project the future sales of a business across multiple products or services over the course of a year. Enter your estimated monthly sales, and the built-in formulas will calculate annual totals. There is also space to record and track year-over-year sales, so you can pinpoint sales trends.

Download 12-Month Sales Forecasting Template for Multiple Products

3-Year Sales Forecast Template for Multiple Products

Use this sales forecast template to estimate the monthly and yearly sales for multiple products over a three-year period. Enter the monthly units sold, unit costs, and unit price. Once you enter those values, built-in formulas will automatically calculate revenue, margin per unit, and gross profit. This template also provides bar charts and line graphs to visually display sales and gross profit year over year.

Download 3-Year Sales Forecast Template - Excel

For a wider selection of resources to project your sales, visit “ Free Sales Forecasting Templates .”

Break-Even Analysis Template for Business Plan

A break-even analysis will help you ascertain the point at which a business, product, or service will become profitable. This analysis uses a calculation to pinpoint the number of service or unit sales you need to make to cover costs and make a profit.

Break-Even Analysis Template

Use this break-even analysis template to calculate the number of sales needed to become profitable. Enter the product's selling price at the top of the template, and then add the fixed and variable costs. Once you enter those values, the built-in formulas will calculate the total variable cost, the contribution margin, and break-even units and sales values.

Download Break-Even Analysis Template

For additional resources, visit, “ Free Financial Planning Templates .”

Business Budget Templates for Business Plan

These business budget templates will help you track costs (e.g., fixed and variable) and expenses (e.g., one-time and recurring) associated with starting and running a business. Having a detailed budget enables you to make sound strategic decisions, and should align with the expense values listed on your income statement.

Startup Budget Template

Use this startup budget template to track estimated and actual costs and expenses for various business categories, including administrative, marketing, labor, and other office costs. There is also room to provide funding estimates from investors, banks, and other sources to get a detailed view of the resources you need to start and operate your business.

Download Startup Budget Template

Small Business Budget Template

This business budget template is ideal for small businesses that want to record estimated revenue and expenditures on a monthly and yearly basis. This customizable template comes with a tab to list income, expenses, and a cash flow recording to track cash transactions and balances.

Download Small Business Budget Template

Professional Business Budget Template

Established organizations will appreciate this customizable business budget template, which contains a separate tab to track projected business expenses, actual business expenses, variances, and an expense analysis. Once you enter projected and actual expenses, the built-in formulas will automatically calculate expense variances and populate the included visual charts.

‌ Download Professional Business Budget Template

For additional resources to plan and track your business costs and expenses, visit “ Free Business Budget Templates for Any Company .”

Other Financial Templates for Business Plan

In this section, you’ll find additional financial templates that you may want to include as part of your larger business plan.

Startup Funding Requirements Template

This simple startup funding requirements template is useful for startups and small businesses that require funding to get business off the ground. The numbers generated in this template should align with those in your financial projections, and should detail the allocation of acquired capital to various startup expenses.

Download Startup Funding Requirements Template - Excel

Personnel Plan Template

Use this customizable personnel plan template to map out the current and future staff needed to get — and keep — the business running. This information belongs in the personnel section of a business plan, and details the job title, amount of pay, and hiring timeline for each position. This template calculates the monthly and yearly expenses associated with each role using built-in formulas. Additionally, you can add an organizational chart to provide a visual overview of the company’s structure.

Download Personnel Plan Template - Excel

Elements of the Financial Section of a Business Plan

Whether your organization is a startup, a small business, or an enterprise, the financial plan is the cornerstone of any business plan. The financial section should demonstrate the feasibility and profitability of your idea and should support all other aspects of the business plan.

Below, you’ll find a quick overview of the components of a solid financial plan.

Financial Overview: This section provides a brief summary of the financial section, and includes key takeaways of the financial statements. If you prefer, you can also add a brief description of each statement in the respective statement’s section.
Key Assumptions: This component details the basis for your financial projections, including tax and interest rates, economic climate, and other critical, underlying factors.
Break-Even Analysis: This calculation helps establish the selling price of a product or service, and determines when a product or service should become profitable.
Pro Forma Income Statement: Also known as a profit and loss statement, this section details the sales, cost of sales, profitability, and other vital financial information to stakeholders.
Pro Forma Cash Flow Statement: This area outlines the projected cash inflows and outflows the business expects to generate from operating, financing, and investing activities during a specific timeframe.
Pro Forma Balance Sheet: This document conveys how your business plans to manage assets, including receivables and inventory.
Key Financial Indicators and Ratios: In this section, highlight key financial indicators and ratios extracted from financial statements that bankers, analysts, and investors can use to evaluate the financial health and position of your business.

Need help putting together the rest of your business plan? Check out our free simple business plan templates to get started. You can learn how to write a successful simple business plan here .

Visit this free non-profit business plan template roundup or download a fill-in-the-blank business plan template to make things easy. If you are looking for a business plan template by file type, visit our pages dedicated specifically to Microsoft Excel , Microsoft Word , and Adobe PDF business plan templates. Read our articles offering startup business plan templates or free 30-60-90-day business plan templates to find more tailored options.

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How to Write a Financial Plan for a Business Plan

Stairs leading up to a dollar sign. Represents creating a financial plan to achieve profitability.

Noah Parsons

4 min. read

Updated July 11, 2024

Download Now: Free Income Statement Template →

Creating a financial plan for a business plan is often the most intimidating part for small business owners.

It’s also one of the most vital. Businesses with well-structured and accurate financial statements are more prepared to pitch to investors, receive funding, and achieve long-term success.

Thankfully, you don’t need an accounting degree to successfully create your budget and forecasts.

Here is everything you need to include in your business plan’s financial plan, along with optional performance metrics, funding specifics, mistakes to avoid , and free templates.

Key components of a financial plan in business plans

A sound financial plan for a business plan is made up of six key components that help you easily track and forecast your business financials. They include your:

Sales forecast

What do you expect to sell in a given period? Segment and organize your sales projections with a personalized sales forecast based on your business type.

Subscription sales forecast

While not too different from traditional sales forecasts—there are a few specific terms and calculations you’ll need to know when forecasting sales for a subscription-based business.

Expense budget

Create, review, and revise your expense budget to keep your business on track and more easily predict future expenses.

How to forecast personnel costs

How much do your current, and future, employees’ pay, taxes, and benefits cost your business? Find out by forecasting your personnel costs.

Profit and loss forecast

Track how you make money and how much you spend by listing all of your revenue streams and expenses in your profit and loss statement.

Cash flow forecast

Manage and create projections for the inflow and outflow of cash by building a cash flow statement and forecast.

Balance sheet

Need a snapshot of your business’s financial position? Keep an eye on your assets, liabilities, and equity within the balance sheet.

What to include if you plan to pursue funding

Do you plan to pursue any form of funding or financing? If the answer is yes, you’ll need to include a few additional pieces of information as part of your business plan’s financial plan example.

Highlight any risks and assumptions

Every entrepreneur takes risks with the biggest being assumptions and guesses about the future. Just be sure to track and address these unknowns in your plan early on.

Plan your exit strategy

Investors will want to know your long-term plans as a business owner. While you don’t need to have all the details, it’s worth taking the time to think through how you eventually plan to leave your business.

Financial ratios and metrics

With your financial statements and forecasts in place, you have all the numbers needed to calculate insightful financial ratios.

While including these metrics in your financial plan for a business plan is entirely optional, having them easily accessible can be valuable for tracking your performance and overall financial situation.

Key financial terms you should know

It’s not hard. Anybody who can run a business can understand these key financial terms. And every business owner and entrepreneur should know them.

Common business ratios

Unsure of which business ratios you should be using? Check out this list of key financial ratios that bankers, financial analysts, and investors will want to see.

Break-even analysis

Do you want to know when you’ll become profitable? Find out how much you need to sell to offset your production costs by conducting a break-even analysis.

How to calculate ROI

How much could a business decision be worth? Evaluate the efficiency or profitability by calculating the potential return on investment (ROI).

How to improve your financial plan

Your financial statements are the core part of your business plan’s financial plan that you’ll revisit most often. Instead of worrying about getting it perfect the first time, check out the following resources to learn how to improve your projections over time.

Common mistakes with business forecasts

I was glad to be asked about common mistakes with startup financial projections. I read about 100 business plans per year, and I have this list of mistakes.

How to improve your financial projections

Learn how to improve your business financial projections by following these five basic guidelines.

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Noah is the COO at Palo Alto Software, makers of the online business plan app LivePlan. He started his career at Yahoo! and then helped start the user review site Epinions.com. From there he started a software distribution business in the UK before coming to Palo Alto Software to run the marketing and product teams.

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Basics of a business plan financials section.

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A good business plan is an entrepreneur’s best friend. It’s an indispensable document, and every section matters, from the executive summary to the market analysis to the appendix; however, no section matters as much as the financials section. You’re in business to make money, after all, and your business plan has to clearly, numerically reflect a lucrative business pursuit, preferably with visuals, especially if you want funding.

The financials section of your business plan tells you and your potential investors, loan providers or partners whether your business idea makes economic sense. Without an impressive financials section, you’re looking at an uphill battle when it comes to scoring capital; underwhelming financials may indicate a need to make some revisions to your approach.

Basic Financials

So, how to build an impressive financials section? As with all things in small business, there’s no one-size-fits-all approach; it varies by business and field. But there are some general guidelines that can give you a clear idea of where to start and what kind of data you’ll need to gather.

You need to include at least three documents in the financials section of your business plan:

1. Income statement: Are you profitable?

2. Cash flow statement: How much cash do you have on hand?

3. Balance sheet: What’s your net worth?

There’s other financial information you can — and often should — add to your business plan, like sales forecasts and personnel plans. But the income statement, cash flow projections and balance sheet are the ones you can’t leave out.

Here's a brief run-down of the three major data sets.

Income Statement

Also called a profit/loss statement, here’s where your reader can see if your business is profitable. If you’re not operating the business yet, this will be a projected income statement, based on a well-informed analysis of your business’s first year.

The income statement is broken down by month and shows revenue (sales), expenses (costs of operating) and the resulting profit or loss for one fiscal year. (Revenue - expenses = profit/loss.)

Cash Flow Statements

Here’s where your reader can see how much money you’re going to need in the first year of operations. If you’re not yet up and running, you’ll only have projections.

For cash flow projections, you’ll predict the cash money that will flow into and out of your business in a particular month. You’ll need a year’s worth of monthly projections. If you’re already operating, also include cash flow statements for past months showing actual numbers.

Cash flow statements have three basic components: cash revenues, cash disbursements and reconciliation of revenues to disbursements. For each month, you start with your previous month’s balance, add revenues and subtract disbursements. The final balance becomes the opening balance for the following month.

Balance Sheet

Here’s where your reader sees your business’s net worth. It breaks down into monthly balance sheets and a final net worth at the end of the fiscal year. There are three parts to a balance sheet:

• Accounts receivable

• Inventory, equipment

• Real estate

2. Liabilities

• Accounts payable

• Loan debts

3. Equity: Total assets minus total liabilities (Assets = liabilities + equity.)

It’s good to offer readers an analysis of the three basic financial statements — how they fit together and what they mean for the future of your business. It doesn’t have to be in depth; focus is good. Just interpret the data from each statement, putting it in context and indicating what the reader should take away from the financials section of your business plan.

How To Conduct Financial Analysis for Your Company

Updated: July 22, 2024

Published: July 07, 2023

If someone were to ask you about your company’s financial strengths and weaknesses, could you give them a detailed answer?

As a founder, you need to know this type of information about your business. Understanding your financial performance is key to making better decisions about growth and investment plans.

The key to painting that picture lies in a process known as financial analysis.

What is financial analysis?

Financial analysis is the process of going over a company’s financial data to evaluate its performance in order to make informed business decisions. Founders and executives use financial analysis to assess performance and make strategic decisions, such as where to invest money to improve growth.

Externally, investors use financial analysis to make decisions about which companies are good investments. Potential lenders, such as banks, may also use financial analysis when they review loan applicants to assess your ability to pay back the money they lend.

Financial analysis is typically done by an external finance professional who reviews documents like the income statement, cash flow statement, and balance sheet.

How to do a financial analysis

1. collect your company’s financial statements.

Financial analysis helps you identify trends in your business’s performance. To get the best insights, compare your business performance over time.

Gather your recent financial statements, including your balance sheets, income statements, and cash flow statements. Look at the last three to five years’ worth of data, which is enough to establish a trend while still focusing on your most recent (and relevant) performance.

Once you have all your documents, arrange them in chronological order.

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2. Analyze balance sheets

Your balance sheets give you a snapshot of your company’s finances at a given point in time, such as the end of a fiscal year. On this sheet, you’ll see the value of your short- and long-term assets, debts, and owner’s equity.

Look at your balance sheets and consider the following questions:

How much debt do you have compared to equity?
Has your debt been increasing or decreasing over time?
How liquid is the business? (i.e., how much of the business’s assets are short term?)
How has the liquidity of the business changed over time?

3. Analyze income statements

Also known as a profit and loss (P&L) statement , the income statement provides insight into your company’s revenue , expenses, and profits.

Evaluate your income statements and look for trends in your:

Gross revenue: Total amount of income generated by sales.
Operating income: Revenue minus the cost of goods sold (COGS). This tells you how much of your revenue remains after you account for operating expenses.
Net profit (or loss): Revenue minus all expenses. This tells you how much money your company earned (or lost) after paying interest and taxes.

Startups can often take two to three years to become profitable . That’s why it’s helpful to track several financial metrics.

For example, you can have a net loss while still generating an operating profit. This means your core business is profitable, but you may still be paying off interest on the loans it took to get the business off the ground.

4. Analyze cash flow statements

Your cash flow statements give you insight into how money flows in and out of your business by looking at your expenses and which activities generate income.

Here are some steps to take in your cash flow analysis :

Review cash flow for each activity (operating, investing, financing). Note whether cash flow is positive (the activity generates income) or negative (the activity loses money).
Compare cash flow from each activity to see which generates the most income for your business.
Review cash inflow and outflow over time to identify trends. Are they increasing or decreasing?
Review total cash to see if it is increasing or decreasing over time.

5. Calculate relevant financial ratios

Calculate financial ratios to get a more detailed picture of your company’s profitability, liquidity, and overall operational efficiency. Here are some of the most common metrics to consider in a ratio analysis.

6. Summarize your findings

Put together all your findings. You can use the following prompts to help organize your analysis:

What are my company’s financial strengths?
What are my company’s financial weaknesses?
How well did the company perform compared to previous financial projections?
What are the possible explanations for my company’s strengths and weaknesses?
What financial improvements do I want to make?

After you conduct your analysis, you’ll know where your business stands in terms of its finances and be able to have educated discussions with stakeholders and potential investors.

Furthermore, you’ll be able to use this knowledge to make more informed decisions about your business’s strategy.

Gaurav Nagani, CEO of help desk software company Desku.io, recommends conducting an analysis “before investing, at regular intervals, before making strategic decisions, and during difficult times.” This way, when you have to make impactful decisions, you’re doing so with a full picture of your company’s financial health.

Common types of financial analysis

There are several different types of financial analysis that you, or a financial professional, can use, depending on what you hope to glean.

Horizontal analysis

Horizontal analysis looks at a company’s performance over time by comparing financial statements over different periods, such as months, quarters, or years.

You can use it to identify growth trends and support financial forecasting , which is the process of using historical data to predict your company’s performance in the future.

Vertical analysis

Vertical analysis looks at a company’s financial performance relative to one metric, such as your total assets. In this case, all line items on the financial statements are expressed as a percentage of total assets. For example, you can use the debt-to-asset ratio, which looks at your total debt as a percentage of total assets.

Say your total debt is $4m and you have $10m in total assets. A vertical analysis would show your debts as 40% of total assets, which is what you get when you divide $4m by $10m.

Using vertical analysis makes it easy to see relationships between the metrics on different financial statements. It’s also helpful for comparing companies with one another for benchmarking.

Valuation is the process of using a company’s financial information to estimate the value of the business .

Investors often compare a company’s estimated value to its stock price to see if they want to buy shares. For startups, valuations are a necessary step to take before starting a priced fundraising round.

Growth Rates

Growth rates represent the percent change in a given metric over time, such as the percent change in net sales over four quarters. Analyzing growth rates can help forecast future performance for specific metrics.

Profitability

Analysts may use profitability ratios , which provide insight into how efficiently your company turns revenue into profit. The higher your profitability ratios, the more resources you’ll have to reinvest into the company’s growth or distribute to your shareholders.

Jeff Schmidt, vice president of financial modeling at Corporate Finance Institute, reminds entrepreneurs, “The point of analysis is to not focus on one method or another but consider the analysis in total and make the proper investment decision.”

Financial analysis example

One example of a financial analysis would be if a financial analyst calculated your company’s profitability ratios , which assess your company’s ability to make money, and leverage ratios , which measure your company’s ability to pay off its debts. Based on the results of the analysis, the analyst will decide if they want to recommend your company as a good investment.

Knowing how to do a financial analysis is a key skill for entrepreneurs because it helps you understand your company’s performance. You can use the insights you gain from financial analysis to make more informed decisions about your overall strategy.

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6 Elements of a Successful Financial Plan for a Small Business

Improve your chances of growth by covering these bases in your plan.

Many small businesses lack a full financial plan, even though evidence shows that it is essential to the long-term success and growth of any business.

For example, a study in the New England Journal of Entrepreneurship found that entrepreneurs with a business plan are more successful than those without one. If you’re not sure how to get started, read on to learn the six key elements of a successful small business financial plan.

What is a business financial plan, and why is it important?

A business financial plan is an overview of a business’s financial situation and a forward-looking projection for growth. A business financial plan typically has six parts: sales forecasting, expense outlay, a statement of financial position, a cash flow projection, a break-even analysis and an operations plan.

A good financial plan helps you manage cash flow and accounts for months when revenue might be lower than expected. It also helps you budget for daily and monthly expenses and plan for taxes each year.

Importantly, a financial plan helps you focus on the long-term growth of your business. That way, you don’t get so caught up in the day-to-day activities that you lose sight of your goals. Focusing on the long-term vision helps you prioritize your financial resources.

The 6 components of a successful financial plan for business

1. sales forecasting.

You should have an estimate of your sales revenue for every month, quarter and year. Identifying any patterns in your sales cycles helps you better understand your business, and this knowledge is invaluable as you plan marketing initiatives and growth strategies .

For instance, a seasonal business can aim to improve sales in the off-season to eventually become a year-round venture. Another business might become better prepared by understanding how upticks and downturns in business relate to factors such as the weather or the economy.

Sales forecasting is also the foundation for setting company growth goals. For instance, you could aim to improve your sales by 10 percent over each previous period.

2. Expense outlay

A full expense plan includes regular expenses, expected future expenses and associated expenses. Regular expenses are the current ongoing costs of your business, including operational costs such as rent, utilities and payroll.

Regular expenses relate to standard business activities that occur each year, such as conference attendance, advertising and marketing, and the office holiday party. It’s a good idea to distinguish essential expenses from expenses that can be reduced or eliminated if needed.

Expected future expenses are known future costs, such as tax rate increases, minimum wage increases or maintenance needs. Generally, a part of the budget should also be allocated to unexpected future expenses, such as damage to your business caused by fire, flood or other unexpected disasters. Planning for future expenses ensures your business is financially prepared via budget reduction, increases in sales or financial assistance.

Associated expenses are the estimated costs of various initiatives, such as acquiring and training new hires, opening a new store or expanding delivery to a new territory. An accurate estimate of associated expenses helps you properly manage growth and prevents your business from exceeding your cost capabilities.

As with expected future expenses, understanding how much capital is required to accomplish various growth goals helps you make the right decision about financing options.

3. Statement of financial position (assets and liabilities)

Assets and liabilities are the foundation of your business’s balance sheet and the primary determinants of your business’s net worth. Tracking both allows you to maximize your business’s potential value.

Small businesses frequently undervalue their assets (such as machinery, property or inventory) and fail to properly account for outstanding bills. Your balance sheet offers a more complete view of your business’s health than a profit-and-loss statement or a cash flow report.

A profit-and-loss statement shows how the business performed over a specific time period, while a balance sheet shows the financial position of the business on any given day.

4. Cash flow projection

You should be able to predict your cash flow on a monthly, quarterly and annual basis. Projecting cash flow for the full year allows you to get ahead of any financial struggles or challenges.

It can also help you identify a cash flow problem before it hurts your business. You can set the most appropriate payment terms, such as how much you charge upfront or how many days after invoicing you expect payment .

A cash flow projection gives you a clear look at how much money is expected to be left at the end of each month so you can plan a possible expansion or other investments. It also helps you budget, such as by spending less one month for the anticipated cash needs of another month.

5. Break-even analysis

A break-even analysis evaluates fixed costs relative to the profit earned by each additional unit you produce and sell. This analysis is essential to understanding your business’s revenue and potential costs versus profits of expansion or growth of your output.

Having your expenses fully fleshed out, as described above, makes your break-even analysis more accurate and useful. A break-even analysis is also the best way to determine your pricing.

In addition, a break-even analysis can tell you how many units you need to sell at various prices to cover your costs. You should aim to set a price that gives you a comfortable margin over your expenses while allowing your business to remain competitive.

6. Operations plan

To run your business as efficiently as possible, craft a detailed overview of your operational needs. Understanding what roles are required for you to operate your business at various volumes of output, how much output or work each employee can handle, and the costs of each stage of your supply chain will aid you in making informed decisions for your business’s growth and efficiency.

It’s important to tightly control expenses, such as payroll or supply chain costs, relative to growth. An operations plan can also make it easier to determine if there is room to optimize your operations or supply chain via automation, new technology or superior supply chain vendors.

For this reason, it is imperative for a business owner to conduct due diligence and become knowledgeable about merchant services before acquiring an account. Once the owner signs a contract, it cannot be changed, unless the business owner breaks the contract and acquires a new account with a new merchant services provider.

Tips on writing a business financial plan

Business owners should create a financial plan annually to ensure they have a clear and accurate picture of their business’s finances and a realistic view for future growth or expansion. A financial plan helps the business’s leaders make informed decisions about purchases, debt, hiring, expense control and overall operations for the year ahead.

A business financial plan is essential if a business owner is looking to sell their business, attract investors or enter a partnership with another business. Here are some tips for writing a business financial plan.

Review the previous year’s plan.

It’s a good idea to compare the previous year’s plan against actual performance and finances to see how accurate the previous plan and forecast were. That way, you can address any discrepancies or overlooked elements in next year’s plan.

Collaborate with other departments.

A business owner or other individual charged with creating the business financial plan should collaborate with the finance department, human resources department, sales team , operations leader, and those in charge of machinery, vehicles or other significant business tools.

Each division should provide the necessary data about projections, value and expenses. All of these elements come together to create a comprehensive financial picture of the business.

Use available resources.

The Small Business Administration (SBA) and SCORE, the SBA’s nonprofit partner, are two excellent resources for learning about financial plans. Both can teach you the elements of a comprehensive plan and how best to work with the different departments in your business to collect the necessary information. Many websites, including business.com , and service providers, such as Intuit, offer advice on this matter.

If you have questions or encounter challenges while creating your business financial plan, seek advice from your accountant or other small business owners in your network. Your city or state has a small business office that you can contact for help.

Business financial plan templates

Many business organizations offer free information that small business owners can use to create their financial plan. For example, the SBA’s Learning Platform offers a course on how to create a business plan. It also offers worksheets and templates to help you get started. You can seek additional help and more personalized service from your local office.

SCORE is the largest volunteer network of business mentors. It began as a group of retired executives (SCORE stands for “Service Corps of Retired Executives”) but has expanded to include business owners and executives from many industries. Advice is free and available online, and there are SBA district offices in every U.S. state. In addition to participating in group or at-home learning, you can be paired with a mentor for individualized help.

SCORE offers templates and tips for creating a small business financial plan. SCORE is an excellent resource because it addresses different levels of experience and offers individualized help.

Other templates can be found in Microsoft Office’s template library, QuickBooks’ online resources, Shopify’s blog and other places. You can also ask your accountant for guidance, since many accountants provide financial planning services in addition to their usual tax services.

Diana Wertz contributed to the writing and research in this article.

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Financial Statement Analysis
How It Works

Types of Financial Statements

Financial performance.

Financial Statement Analysis FAQs
Corporate Finance
Financial statements: Balance, income, cash flow, and equity

Financial Statement Analysis: How It’s Done, by Statement Type

Katrina Ávila Munichiello is an experienced editor, writer, fact-checker, and proofreader with more than fourteen years of experience working with print and online publications.

What Is Financial Statement Analysis?

Financial statement analysis is the process of analyzing a company’s financial statements for decision-making purposes. External stakeholders use it to understand the overall health of an organization and to evaluate financial performance and business value. Internal constituents use it as a monitoring tool for managing the finances.

Key Takeaways

Financial statement analysis is used by internal and external stakeholders to evaluate business performance and value.
Financial accounting calls for all companies to create a balance sheet, income statement, and cash flow statement, which form the basis for financial statement analysis.
Horizontal, vertical, and ratio analysis are three techniques that analysts use when analyzing financial statements.

Jiaqi Zhou / Investopedia

How to Analyze Financial Statements

The financial statements of a company record important financial data on every aspect of a business’s activities. As such, they can be evaluated on the basis of past, current, and projected performance.

In general, financial statements are centered around generally accepted accounting principles (GAAP) in the United States. These principles require a company to create and maintain three main financial statements: the balance sheet, the income statement, and the cash flow statement. Public companies have stricter standards for financial statement reporting. Public companies must follow GAAP, which requires accrual accounting. Private companies have greater flexibility in their financial statement preparation and have the option to use either accrual or cash accounting.

Several techniques are commonly used as part of financial statement analysis. Three of the most important techniques are horizontal analysis , vertical analysis , and ratio analysis . Horizontal analysis compares data horizontally, by analyzing values of line items across two or more years. Vertical analysis looks at the vertical effects that line items have on other parts of the business and the business’s proportions. Ratio analysis uses important ratio metrics to calculate statistical relationships.

Companies use the balance sheet, income statement, and cash flow statement to manage the operations of their business and to provide transparency to their stakeholders. All three statements are interconnected and create different views of a company’s activities and performance.

Balance Sheet

The balance sheet is a report of a company’s financial worth in terms of book value. It is broken into three parts to include a company’s assets , liabilities , and shareholder equity . Short-term assets such as cash and accounts receivable can tell a lot about a company’s operational efficiency; liabilities include the company’s expense arrangements and the debt capital it is paying off; and shareholder equity includes details on equity capital investments and retained earnings from periodic net income. The balance sheet must balance assets and liabilities to equal shareholder equity. This figure is considered a company’s book value and serves as an important performance metric that increases or decreases with the financial activities of a company.

Income Statement

The income statement breaks down the revenue that a company earns against the expenses involved in its business to provide a bottom line, meaning the net profit or loss. The income statement is broken into three parts that help to analyze business efficiency at three different points. It begins with revenue and the direct costs associated with revenue to identify gross profit . It then moves to operating profit , which subtracts indirect expenses like marketing costs, general costs, and depreciation. Finally, after deducting interest and taxes, the net income is reached.

Basic analysis of the income statement usually involves the calculation of gross profit margin, operating profit margin, and net profit margin, which each divide profit by revenue. Profit margin helps to show where company costs are low or high at different points of the operations.

Cash Flow Statement

The cash flow statement provides an overview of the company’s cash flows from operating activities, investing activities, and financing activities. Net income is carried over to the cash flow statement, where it is included as the top line item for operating activities. Like its title, investing activities include cash flows involved with firm-wide investments. The financing activities section includes cash flow from both debt and equity financing. The bottom line shows how much cash a company has available.

Free Cash Flow and Other Valuation Statements

Companies and analysts also use free cash flow statements and other valuation statements to analyze the value of a company . Free cash flow statements arrive at a net present value by discounting the free cash flow that a company is estimated to generate over time. Private companies may keep a valuation statement as they progress toward potentially going public.

Financial statements are maintained by companies daily and used internally for business management. In general, both internal and external stakeholders use the same corporate finance methodologies for maintaining business activities and evaluating overall financial performance .

When doing comprehensive financial statement analysis, analysts typically use multiple years of data to facilitate horizontal analysis. Each financial statement is also analyzed with vertical analysis to understand how different categories of the statement are influencing results. Finally, ratio analysis can be used to isolate some performance metrics in each statement and bring together data points across statements collectively.

Below is a breakdown of some of the most common ratio metrics:

Balance sheet : This includes asset turnover, quick ratio, receivables turnover, days to sales, debt to assets, and debt to equity.
Income statement : This includes gross profit margin, operating profit margin, net profit margin, tax ratio efficiency, and interest coverage.
Cash flow : This includes cash and earnings before interest, taxes, depreciation, and amortization (EBITDA) . These metrics may be shown on a per-share basis.
Comprehensive : This includes return on assets (ROA) and return on equity (ROE) , along with DuPont analysis .

What are the advantages of financial statement analysis?

The main point of financial statement analysis is to evaluate a company’s performance or value through a company’s balance sheet, income statement, or statement of cash flows. By using a number of techniques, such as horizontal, vertical, or ratio analysis, investors may develop a more nuanced picture of a company’s financial profile.

What are the different types of financial statement analysis?

Most often, analysts will use three main techniques for analyzing a company’s financial statements.

First, horizontal analysis involves comparing historical data. Usually, the purpose of horizontal analysis is to detect growth trends across different time periods.

Second, vertical analysis compares items on a financial statement in relation to each other. For instance, an expense item could be expressed as a percentage of company sales.

Finally, ratio analysis, a central part of fundamental equity analysis, compares line-item data. Price-to-earnings (P/E) ratios, earnings per share, or dividend yield are examples of ratio analysis.

What is an example of financial statement analysis?

An analyst may first look at a number of ratios on a company’s income statement to determine how efficiently it generates profits and shareholder value. For instance, gross profit margin will show the difference between revenues and the cost of goods sold. If the company has a higher gross profit margin than its competitors, this may indicate a positive sign for the company. At the same time, the analyst may observe that the gross profit margin has been increasing over nine fiscal periods, applying a horizontal analysis to the company’s operating trends.

Congressional Research Service. “ Cash Versus Accrual Basis of Accounting: An Introduction ,” Page 3 (Page 7 of PDF).

Internal Revenue Service. “ Publication 538 (01/2022), Accounting Periods and Methods: Methods You Can Use. ”

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How to Conduct a Strategic Financial Analysis for Your Business

Posted may 25, 2021 by noah parsons.

How often do you review your business numbers? If you look at the financial performance of your business at least once a month or perhaps even more frequently , you’re in good shape—and better off than most businesses.

Unfortunately, too many businesses review their books only every few months, and frankly, that’s not a great strategy. It gives those businesses fewer opportunities to see if things are going well or not. The more frequently you review your business finances, the more chances you have to find opportunities for growth .

But how do you approach reviewing your financials? What documents should you analyze? What exactly should you be looking for? Let’s try to answer those questions by introducing you to a process known as a strategic financial analysis.

What is a strategic financial analysis?

A strategic financial analysis is a review framework where you analyze performance, assess your goals, and make adjustments to your forecasts and strategy based on actual results. In short, this is where you connect the dots between your numbers and the actions that you’re taking. The intention is to identify any potential problems or opportunities within your financials and turn them into strategic steps for growth.

In some cases, this analysis may also include a deeper look at your business model, comparisons against your competitors , and even different forecast scenarios.

What financial statements should I review when conducting a strategic financial analysis?

When you’re reviewing your business financials, you’ll want to check these three key reports:

Profit and loss (also known as an income statement)
Balance sheet

Each report will tell you different things about your business. Put together, they’ll provide you with nearly everything you’ll want to know about your business performance. By the end, you should be able to bring your forecasts for these statements up to speed based on your actual results .

How to conduct a strategic financial analysis

Here are the five steps you’ll want to take when conducting a strategic analysis of your financial statements.

1. Compare your forecast to your actuals monthly

So, if you’re reviewing your business financials regularly, you’re off to a good start.

But to get even more value out of that financial review, you need to start comparing your actuals —how your business performed—to your forecast.

Ideally, compare your plan to what actually happens in a monthly meeting with your key staff. You’ll want to have your forecast handy as well as reports from your accounting software so you can compare the two and see if you’re on track.

If you’re using LivePlan, the software will do all of the number-crunching and comparison work for you—no spreadsheets required—and you’ll be able to compare everything in a simple financial dashboard .

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2. Identify where you’re off track or exceeding projections

When you’re forecasting, you’re making educated guesses. This means that your actual financial performance in a given month will vary.

You’ll typically either be off track and performing worse than expected. On track and sitting fairly close to expectations. Or, outperforming your forecasts and exceeding expectations.

What does comparing my plan to my actual results do for me?

If you just review what happened in the past, you’ll get a good idea of what happened during the past month of your business. But, it’s difficult to know if your performance is good or bad if you’re not comparing your actual results against your plan.

How do you know if you’re meeting your sales goals?
Can you tell that you’re keeping your spending within your budget?
Are you keeping as much cash in the bank as you need to?

Even more importantly, if you have plans to grow your business or make significant investments, you’ll want to know if it makes financial sense to spend the money. Should you invest now or should you wait for a better time? Should you open a second location or hold off?

By reviewing your plan and comparing it to your actual results, you’ll get a better sense of when you should look to expand, and when you should be reining things in. Make a mistake and invest in your business at the wrong time and you could create a cash flow crunch that could sink your business.

3. Review your Income statement (profit and loss or P&L)

Your income statement (also called profit and loss or P&L) documents your income and your expenses. When you compare this statement to your forecast, you’ll see if your sales are meeting your goals and if you’re keeping your expenses in line with your budget.

If you’re not sure what’s included in an income statement or what types of information you’ll find there, start with this guide to reading a profit and loss or income statement that will help orient you to each line item.

You can also download an income statement example to help you better visualize the information. For a more dynamic solution that displays actual results for completed periods right into your forecasted Profit and Loss statement, check out LivePlan’s LiveForecast feature . No more hours spent inputting accounting information. Just you spending more time digging into what is and isn’t working for your business.

When you’re ready to dive deeper and start your income statement analysis, use this income statement analysis guide for your monthly financial review. It walks you through typical questions that might come up as you’re doing your review. That way, you can use your findings to make better strategic decisions for the health and growth of your business.

4. Analyze your cash flow statement

Your cash flow statement will tell you exactly how cash moved into and out of your business. Comparing this statement to your cash flow forecast will tell you if you’re on track to grow your bank balance the way you had planned, and why you might be off track if things aren’t going the way you had hoped.

Check out this article on how to read a cash flow statement for a line-by-line explanation of how it works. And download our cash flow statement example PDF and Excel spreadsheet if you’re looking for a sample to work from as you review your own.

When you’re ready to start comparing your actual cash flow to your forecast, this guide to cash flow analysis will help you get started.

5. Review your balance sheet

Your balance sheet will give you a complete overview of your financial position. How much money are you owed and how much money do you owe? What assets does your business have? Your balance sheet analysis will help you understand if you’re collecting money from your customers at the right rate, and if you’re taking on more debt than planned.

If you’re new to balance sheet review, this article offers more insight on how a balance sheet is set up, and what you need to know about each line. You can also download a balance sheet example to help you visualize it better.

When you’re ready to do your monthly review, this balance sheet analysis guide will help you get started.

Look beyond your financials for more insights

Doing a monthly financial statement analysis—comparing your actuals to your plan or forecast—helps you keep a finger on the pulse of your business finances.

Additionally, it’s wise to look at industry benchmarks , financial shifts in your industry, and any other external factors that may be affecting your financial performance. Use your initial comparison to actual performance to jumpstart this market analysis and help you define the next steps.

When you identify a gap or variance between what you forecast and what actually happened, use that information to help you make strategic shifts in your business so you can quickly address challenges and take advantage of opportunities.

Editors’ note: This article was originally published in 2019 and updated for 2021.

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Business Plan Example and Template

Learn how to create a business plan

What is a Business Plan?

A business plan is a document that contains the operational and financial plan of a business, and details how its objectives will be achieved. It serves as a road map for the business and can be used when pitching investors or financial institutions for debt or equity financing .

Business Plan - Document with the words Business Plan on the title

A business plan should follow a standard format and contain all the important business plan elements. Typically, it should present whatever information an investor or financial institution expects to see before providing financing to a business.

Contents of a Business Plan

A business plan should be structured in a way that it contains all the important information that investors are looking for. Here are the main sections of a business plan:

1. Title Page

The title page captures the legal information of the business, which includes the registered business name, physical address, phone number, email address, date, and the company logo.

2. Executive Summary

The executive summary is the most important section because it is the first section that investors and bankers see when they open the business plan. It provides a summary of the entire business plan. It should be written last to ensure that you don’t leave any details out. It must be short and to the point, and it should capture the reader’s attention. The executive summary should not exceed two pages.

3. Industry Overview

The industry overview section provides information about the specific industry that the business operates in. Some of the information provided in this section includes major competitors, industry trends, and estimated revenues. It also shows the company’s position in the industry and how it will compete in the market against other major players.

4. Market Analysis and Competition

The market analysis section details the target market for the company’s product offerings. This section confirms that the company understands the market and that it has already analyzed the existing market to determine that there is adequate demand to support its proposed business model.

Market analysis includes information about the target market’s demographics , geographical location, consumer behavior, and market needs. The company can present numbers and sources to give an overview of the target market size.

A business can choose to consolidate the market analysis and competition analysis into one section or present them as two separate sections.

5. Sales and Marketing Plan

The sales and marketing plan details how the company plans to sell its products to the target market. It attempts to present the business’s unique selling proposition and the channels it will use to sell its goods and services. It details the company’s advertising and promotion activities, pricing strategy, sales and distribution methods, and after-sales support.

6. Management Plan

The management plan provides an outline of the company’s legal structure, its management team, and internal and external human resource requirements. It should list the number of employees that will be needed and the remuneration to be paid to each of the employees.

Any external professionals, such as lawyers, valuers, architects, and consultants, that the company will need should also be included. If the company intends to use the business plan to source funding from investors, it should list the members of the executive team, as well as the members of the advisory board.

7. Operating Plan

The operating plan provides an overview of the company’s physical requirements, such as office space, machinery, labor, supplies, and inventory . For a business that requires custom warehouses and specialized equipment, the operating plan will be more detailed, as compared to, say, a home-based consulting business. If the business plan is for a manufacturing company, it will include information on raw material requirements and the supply chain.

8. Financial Plan

The financial plan is an important section that will often determine whether the business will obtain required financing from financial institutions, investors, or venture capitalists. It should demonstrate that the proposed business is viable and will return enough revenues to be able to meet its financial obligations. Some of the information contained in the financial plan includes a projected income statement , balance sheet, and cash flow.

9. Appendices and Exhibits

The appendices and exhibits part is the last section of a business plan. It includes any additional information that banks and investors may be interested in or that adds credibility to the business. Some of the information that may be included in the appendices section includes office/building plans, detailed market research , products/services offering information, marketing brochures, and credit histories of the promoters.

Business Plan Template

Here is a basic template that any business can use when developing its business plan:

Section 1: Executive Summary

Present the company’s mission.
Describe the company’s product and/or service offerings.
Give a summary of the target market and its demographics.
Summarize the industry competition and how the company will capture a share of the available market.
Give a summary of the operational plan, such as inventory, office and labor, and equipment requirements.

Section 2: Industry Overview

Describe the company’s position in the industry.
Describe the existing competition and the major players in the industry.
Provide information about the industry that the business will operate in, estimated revenues, industry trends, government influences, as well as the demographics of the target market.

Section 3: Market Analysis and Competition

Define your target market, their needs, and their geographical location.
Describe the size of the market, the units of the company’s products that potential customers may buy, and the market changes that may occur due to overall economic changes.
Give an overview of the estimated sales volume vis-à-vis what competitors sell.
Give a plan on how the company plans to combat the existing competition to gain and retain market share.

Section 4: Sales and Marketing Plan

Describe the products that the company will offer for sale and its unique selling proposition.
List the different advertising platforms that the business will use to get its message to customers.
Describe how the business plans to price its products in a way that allows it to make a profit.
Give details on how the company’s products will be distributed to the target market and the shipping method.

Section 5: Management Plan

Describe the organizational structure of the company.
List the owners of the company and their ownership percentages.
List the key executives, their roles, and remuneration.
List any internal and external professionals that the company plans to hire, and how they will be compensated.
Include a list of the members of the advisory board, if available.

Section 6: Operating Plan

Describe the location of the business, including office and warehouse requirements.
Describe the labor requirement of the company. Outline the number of staff that the company needs, their roles, skills training needed, and employee tenures (full-time or part-time).
Describe the manufacturing process, and the time it will take to produce one unit of a product.
Describe the equipment and machinery requirements, and if the company will lease or purchase equipment and machinery, and the related costs that the company estimates it will incur.
Provide a list of raw material requirements, how they will be sourced, and the main suppliers that will supply the required inputs.

Section 7: Financial Plan

Describe the financial projections of the company, by including the projected income statement, projected cash flow statement, and the balance sheet projection.

Section 8: Appendices and Exhibits

Quotes of building and machinery leases
Proposed office and warehouse plan
Market research and a summary of the target market
Credit information of the owners
List of product and/or services

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Building Your Business
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Business Plans

Writing a Business Plan—Financial Projections

Spell out your financial forecast in dollars and sense

Creating financial projections for your startup is both an art and a science. Although investors want to see cold, hard numbers, it can be difficult to predict your financial performance three years down the road, especially if you are still raising seed money. Regardless, short- and medium-term financial projections are a required part of your business plan if you want serious attention from investors.

The financial section of your business plan should include a sales forecast , expenses budget , cash flow statement , balance sheet , and a profit and loss statement . Be sure to follow the generally accepted accounting principles (GAAP) set forth by the Financial Accounting Standards Board , a private-sector organization responsible for setting financial accounting and reporting standards in the U.S. If financial reporting is new territory for you, have an accountant review your projections.

Sales Forecast

As a startup business, you do not have past results to review, which can make forecasting sales difficult. It can be done, though, if you have a good understanding of the market you are entering and industry trends as a whole. In fact, sales forecasts based on a solid understanding of industry and market trends will show potential investors that you've done your homework and your forecast is more than just guesswork.

In practical terms, your forecast should be broken down by monthly sales with entries showing which units are being sold, their price points, and how many you expect to sell. When getting into the second year of your business plan and beyond, it's acceptable to reduce the forecast to quarterly sales. In fact, that's the case for most items in your business plan.

Expenses Budget

What you're selling has to cost something, and this budget is where you need to show your expenses. These include the cost to your business of the units being sold in addition to overhead. It's a good idea to break down your expenses by fixed costs and variable costs. For example, certain expenses will be the same or close to the same every month, including rent, insurance, and others. Some costs likely will vary month by month such as advertising or seasonal sales help.

Cash Flow Statement

As with your sales forecast, cash flow statements for a startup require doing some homework since you do not have historical data to use as a reference. This statement, in short, breaks down how much cash is coming into your business on a monthly basis vs. how much is going out. By using your sales forecasts and your expenses budget, you can estimate your cash flow intelligently.

Keep in mind that revenue often will trail sales, depending on the type of business you are operating. For example, if you have contracts with clients, they may not be paying for items they purchase until the month following delivery. Some clients may carry balances 60 or 90 days beyond delivery. You need to account for this lag when calculating exactly when you expect to see your revenue.

Profit and Loss Statement

Your P&L statement should take the information from your sales projections, expenses budget, and cash flow statement to project how much you expect in profits or losses through the three years included in your business plan. You should have a figure for each individual year as well as a figure for the full three-year period.

Balance Sheet

You provide a breakdown of all of your assets and liabilities in the balances sheet. Many of these assets and liabilities are items that go beyond monthly sales and expenses. For example, any property, equipment, or unsold inventory you own is an asset with a value that can be assigned to it. The same goes for outstanding invoices owed to you that have not been paid. Even though you don't have the cash in hand, you can count those invoices as assets. The amount you owe on a business loan or the amount you owe others on invoices you've not paid would count as liabilities. The balance is the difference between the value of everything you own vs. the value of everything you owe.

Break-Even Projection

If you've done a good job projecting your sales and expenses and inputting the numbers into a spreadsheet, you should be able to identify a date when your business breaks even—in other words, the date when you become profitable, with more money coming in than going out. As a startup business, this is not expected to happen overnight, but potential investors want to see that you have a date in mind and that you can support that projection with the numbers you've supplied in the financial section of your business plan.

Additional Tips

When putting together your financial projections, keep some general tips in mind:

Get comfortable with spreadsheet software if you aren't already. It is the starting point for all financial projections and offers flexibility, allowing you to quickly change assumptions or weigh alternative scenarios. Microsoft Excel is the most common, and chances are you already have it on your computer. You can also buy special software packages to help with financial projections.
Prepare a five-year projection . Don’t include this one in the business plan, since the further into the future you project, the harder it is to predict. However, have the projection available in case an investor asks for it.
Offer two scenarios only . Investors will want to see a best-case and worst-case scenario, but don’t inundate your business plan with myriad medium-case scenarios. They likely will just cause confusion.
Be reasonable and clear . As mentioned before, financial forecasting is as much art as science. You’ll have to assume certain things, such as your revenue growth, how your raw material and administrative costs will grow, and how effective you’ll be at collecting on accounts receivable. It’s best to be realistic in your projections as you try to recruit investors. If your industry is going through a contraction period and you’re projecting revenue growth of 20 percent a month, expect investors to see red flags.

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How to Craft the Financial Section of Business Plan (Hint: It’s All About the Numbers)

Writing a small business plan takes time and effort … especially when you have to dive into the numbers for the financial section. But, working on the financial section of business plan could lead to a big payoff for your business.

Read on to learn what is the financial section of a business plan, why it matters, and how to write one for your company.

What is the financial section of business plan?

Generally, the financial section is one of the last sections in a business plan. It describes a business’s historical financial state (if applicable) and future financial projections. Businesses include supporting documents such as budgets and financial statements, as well as funding requests in this section of the plan.

The financial part of the business plan introduces numbers. It comes after the executive summary, company description , market analysis, organization structure, product information, and marketing and sales strategies.

Businesses that are trying to get financing from lenders or investors use the financial section to make their case. This section also acts as a financial roadmap so you can budget for your business’s future income and expenses.

Why it matters

The financial section of the business plan is critical for moving beyond wordy aspirations and into hard data and the wonderful world of numbers.

Through the financial section, you can:

Forecast your business’s future finances
Budget for expenses (e.g., startup costs)
Get financing from lenders or investors
Grow your business

describes how you can use the four ways to use the financial section of business plan

Growth : 64% of businesses with a business plan were able to grow their business, compared to 43% of businesses without a business plan.
Financing : 36% of businesses with a business plan secured a loan, compared to 18% of businesses without a plan.

So, if you want to possibly double your chances of securing a business loan, consider putting in a little time and effort into your business plan’s financial section.

Writing your financial section

To write the financial section, you first need to gather some information. Keep in mind that the information you gather depends on whether you have historical financial information or if you’re a brand-new startup.

Your financial section should detail:

Business expenses

Financial projections

Financial statements, break-even point, funding requests, exit strategy, business expenses.

Whether you’ve been in business for one day or 10 years, you have expenses. These expenses might simply be startup costs for new businesses or fixed and variable costs for veteran businesses.

Take a look at some common business expenses you may need to include in the financial section of business plan:

Licenses and permits
Cost of goods sold
Rent or mortgage payments
Payroll costs (e.g., salaries and taxes)
Utilities
Equipment
Supplies
Advertising

Write down each type of expense and amount you currently have as well as expenses you predict you’ll have. Use a consistent time period (e.g., monthly costs).

Indicate which expenses are fixed (unchanging month-to-month) and which are variable (subject to changes).

How much do you anticipate earning from sales each month?

If you operate an existing business, you can look at previous monthly revenue to make an educated estimate. Take factors into consideration, like seasonality and economic ups and downs, when basing projections on previous cash flow.

Coming up with your financial projections may be a bit trickier if you are a startup. After all, you have nothing to go off of. Come up with a reasonable monthly goal based on things like your industry, competitors, and the market. Hint : Look at your market analysis section of the business plan for guidance.

A financial statement details your business’s finances. The three main types of financial statements are income statements, cash flow statements, and balance sheets.

Income statements summarize your business’s income and expenses during a period of time (e.g., a month). This document shows whether your business had a net profit or loss during that time period.

Cash flow statements break down your business’s incoming and outgoing money. This document details whether your company has enough cash on hand to cover expenses.

The balance sheet summarizes your business’s assets, liabilities, and equity. Balance sheets help with debt management and business growth decisions.

If you run a startup, you can create “pro forma financial statements,” which are statements based on projections.

If you’ve been in business for a bit, you should have financial statements in your records. You can include these in your business plan. And, include forecasted financial statements.

You’re just in luck. Check out our FREE guide, Use Financial Statements to Assess the Health of Your Business , to learn more about the different types of financial statements for your business.

Potential investors want to know when your business will reach its break-even point. The break-even point is when your business’s sales equal its expenses.

Estimate when your company will reach its break-even point and detail it in the financial section of business plan.

If you’re looking for financing, detail your funding request here. Include how much you are looking for, list ideal terms (e.g., 10-year loan or 15% equity), and how long your request will cover.

Remember to discuss why you are requesting money and what you plan on using the money for (e.g., equipment).

Back up your funding request by emphasizing your financial projections.

Last but not least, your financial section should also discuss your business’s exit strategy. An exit strategy is a plan that outlines what you’ll do if you need to sell or close your business, retire, etc.

Investors and lenders want to know how their investment or loan is protected if your business doesn’t make it. The exit strategy does just that. It explains how your business will make ends meet even if it doesn’t make it.

When you’re working on the financial section of business plan, take advantage of your accounting records to make things easier on yourself. For organized books, try Patriot’s online accounting software . Get your free trial now!

Stay up to date on the latest accounting tips and training

Business Plan Financial Projections

Written by Dave Lavinsky

Financial projections are forecasted analyses of your business’ future that include income statements, balance sheets and cash flow statements. We have found them to be an crucial part of your business plan for the following reasons:

They can help prove or disprove the viability of your business idea. For example, if your initial projections show your company will never make a sizable profit, your venture might not be feasible. Or, in such a case, you might figure out ways to raise prices, enter new markets, or streamline operations to make it profitable.
Financial projections give investors and lenders an idea of how well your business is likely to do in the future. They can give lenders the confidence that you’ll be able to comfortably repay their loan with interest. And for equity investors, your projections can give them faith that you’ll earn them a solid return on investment. In both cases, your projections can help you secure the funding you need to launch or grow your business.
Financial projections help you track your progress over time and ensure your business is on track to meet its goals. For example, if your financial projections show you should generate $500,000 in sales during the year, but you are not on track to accomplish that, you’ll know you need to take corrective action to achieve your goal.

Below you’ll learn more about the key components of financial projections and how to complete and include them in your business plan.

What Are Business Plan Financial Projections?

Financial projections are an estimate of your company’s future financial performance through financial forecasting. They are typically used by businesses to secure funding, but can also be useful for internal decision-making and planning purposes. There are three main financial statements that you will need to include in your business plan financial projections:

1. Income Statement Projection

The income statement projection is a forecast of your company’s future revenues and expenses. It should include line items for each type of income and expense, as well as a total at the end.

There are a few key items you will need to include in your projection:

Revenue: Your revenue projection should break down your expected sales by product or service, as well as by month. It is important to be realistic in your projections, so make sure to account for any seasonal variations in your business.
Expenses: Your expense projection should include a breakdown of your expected costs by category, such as marketing, salaries, and rent. Again, it is important to be realistic in your estimates.
Net Income: The net income projection is the difference between your revenue and expenses. This number tells you how much profit your company is expected to make.

Sample Income Statement

		FY 1	FY 2	FY 3	FY 4	FY 5
Revenues
	Total Revenues	$360,000	$793,728	$875,006	$964,606	$1,063,382

Expenses & Costs

	Cost of goods sold	$64,800	$142,871	$157,501	$173,629	$191,409
	Lease	$50,000	$51,250	$52,531	$53,845	$55,191
	Marketing	$10,000	$8,000	$8,000	$8,000	$8,000
	Salaries	$157,015	$214,030	$235,968	$247,766	$260,155
	Initial expenditure	$10,000	$0	$0	$0	$0

	Total Expenses & Costs	$291,815	$416,151	$454,000	$483,240	$514,754

EBITDA		$68,185	$377,577	$421,005	$481,366	$548,628
	Depreciation	$27,160	$27,160	$27,160	$27,160	$27,160
EBIT		$41,025	$350,417	$393,845	$454,206	$521,468
	Interest	$23,462	$20,529	$17,596	$14,664	$11,731
PRETAX INCOME		$17,563	$329,888	$376,249	$439,543	$509,737
	Net Operating Loss	$0	$0	$0	$0	$0
	Use of Net Operating Loss	$0	$0	$0	$0	$0
	Taxable Income	$17,563	$329,888	$376,249	$439,543	$509,737
	Income Tax Expense	$6,147	$115,461	$131,687	$153,840	$178,408
NET INCOME		$11,416	$214,427	$244,562	$285,703	$331,329

2. Cash Flow Statement & Projection

The cash flow statement and projection are a forecast of your company’s future cash inflows and outflows. It is important to include a cash flow projection in your business plan, as it will give investors and lenders an idea of your company’s ability to generate cash.

There are a few key items you will need to include in your cash flow projection:

The cash flow statement shows a breakdown of your expected cash inflows and outflows by month. It is important to be realistic in your projections, so make sure to account for any seasonal variations in your business.
Cash inflows should include items such as sales revenue, interest income, and capital gains. Cash outflows should include items such as salaries, rent, and marketing expenses.
It is important to track your company’s cash flow over time to ensure that it is healthy. A healthy cash flow is necessary for a successful business.

Sample Cash Flow Statements

		FY 1	FY 2	FY 3	FY 4	FY 5
CASH FLOW FROM OPERATIONS
	Net Income (Loss)	$11,416	$214,427	$244,562	$285,703	$331,329
	Change in working capital	($19,200)	($1,966)	($2,167)	($2,389)	($2,634)
	Depreciation	$27,160	$27,160	$27,160	$27,160	$27,160
	Net Cash Flow from Operations	$19,376	$239,621	$269,554	$310,473	$355,855

CASH FLOW FROM INVESTMENTS
	Investment	($180,950)	$0	$0	$0	$0
	Net Cash Flow from Investments	($180,950)	$0	$0	$0	$0

CASH FLOW FROM FINANCING
	Cash from equity	$0	$0	$0	$0	$0
	Cash from debt	$315,831	($45,119)	($45,119)	($45,119)	($45,119)
	Net Cash Flow from Financing	$315,831	($45,119)	($45,119)	($45,119)	($45,119)

	Net Cash Flow	$154,257	$194,502	$224,436	$265,355	$310,736
	Cash at Beginning of Period	$0	$154,257	$348,760	$573,195	$838,550
	Cash at End of Period	$154,257	$348,760	$573,195	$838,550	$1,149,286

3. Balance Sheet Projection

The balance sheet projection is a forecast of your company’s future financial position. It should include line items for each type of asset and liability, as well as a total at the end.

A projection should include a breakdown of your company’s assets and liabilities by category. It is important to be realistic in your projections, so make sure to account for any seasonal variations in your business.

It is important to track your company’s financial position over time to ensure that it is healthy. A healthy balance is necessary for a successful business.

Sample Balance Sheet

		FY 1	FY 2	FY 3	FY 4	FY 5
ASSETS
	Cash	$154,257	$348,760	$573,195	$838,550	$1,149,286
	Accounts receivable	$0	$0	$0	$0	$0
	Inventory	$30,000	$33,072	$36,459	$40,192	$44,308
	Total Current Assets	$184,257	$381,832	$609,654	$878,742	$1,193,594

	Fixed assets	$180,950	$180,950	$180,950	$180,950	$180,950
	Depreciation	$27,160	$54,320	$81,480	$108,640	$135,800
	Net fixed assets	$153,790	$126,630	$99,470	$72,310	$45,150

TOTAL ASSETS		$338,047	$508,462	$709,124	$951,052	$1,238,744

LIABILITIES & EQUITY
	Debt	$315,831	$270,713	$225,594	$180,475	$135,356
	Accounts payable	$10,800	$11,906	$13,125	$14,469	$15,951
	Total Liability	$326,631	$282,618	$238,719	$194,944	$151,307

	Share Capital	$0	$0	$0	$0	$0
	Retained earnings	$11,416	$225,843	$470,405	$756,108	$1,087,437
	Total Equity	$11,416	$225,843	$470,405	$756,108	$1,087,437

TOTAL LIABILITIES & EQUITY		$338,047	$508,462	$709,124	$951,052	$1,238,744

How to Create Financial Projections

Creating financial projections for your business plan can be a daunting task, but it’s important to put together accurate and realistic financial projections in order to give your business the best chance for success.

Cost Assumptions

When you create financial projections, it is important to be realistic about the costs your business will incur, using historical financial data can help with this. You will need to make assumptions about the cost of goods sold, operational costs, and capital expenditures.

It is important to track your company’s expenses over time to ensure that it is staying within its budget. A healthy bottom line is necessary for a successful business.

Capital Expenditures, Funding, Tax, and Balance Sheet Items

You will also need to make assumptions about capital expenditures, funding, tax, and balance sheet items. These assumptions will help you to create a realistic financial picture of your business.

Capital Expenditures

When projecting your company’s capital expenditures, you will need to make a number of assumptions about the type of equipment or property your business will purchase. You will also need to estimate the cost of the purchase.

When projecting your company’s funding needs, you will need to make a number of assumptions about where the money will come from. This might include assumptions about bank loans, venture capital, or angel investors.

When projecting your company’s tax liability, you will need to make a number of assumptions about the tax rates that will apply to your business. You will also need to estimate the amount of taxes your company will owe.

Balance Sheet Items

When projecting your company’s balance, you will need to make a number of assumptions about the type and amount of debt your business will have. You will also need to estimate the value of your company’s assets and liabilities.

Financial Projection Scenarios

Write two financial scenarios when creating your financial projections, a best-case scenario, and a worst-case scenario. Use your list of assumptions to come up with realistic numbers for each scenario.

Presuming that you have already generated a list of assumptions, the creation of best and worst-case scenarios should be relatively simple. For each assumption, generate a high and low estimate. For example, if you are assuming that your company will have $100,000 in revenue, your high estimate might be $120,000 and your low estimate might be $80,000.

Once you have generated high and low estimates for all of your assumptions, you can create two scenarios: a best case scenario and a worst-case scenario. Simply plug the high estimates into your financial projections for the best-case scenario and the low estimates into your financial projections for the worst-case scenario.

Conduct a Ratio Analysis

A ratio analysis is a useful tool that can be used to evaluate a company’s financial health. Ratios can be used to compare a company’s performance to its industry average or to its own historical performance.

There are a number of different ratios that can be used in ratio analysis. Some of the more popular ones include the following:

Gross margin ratio
Operating margin ratio
Return on assets (ROA)
Return on equity (ROE)

To conduct a ratio analysis, you will need financial statements for your company and for its competitors. You will also need industry average ratios. These can be found in industry reports or on financial websites.

Once you have the necessary information, you can calculate the ratios for your company and compare them to the industry averages or to your own historical performance. If your company’s ratios are significantly different from the industry averages, it might be indicative of a problem.

Be Realistic

When creating your financial projections, it is important to be realistic. Your projections should be based on your list of assumptions and should reflect your best estimate of what your company’s future financial performance will be. This includes projected operating income, a projected income statement, and a profit and loss statement.

Your goal should be to create a realistic set of financial projections that can be used to guide your company’s future decision-making.

Sales Forecast

One of the most important aspects of your financial projections is your sales forecast. Your sales forecast should be based on your list of assumptions and should reflect your best estimate of what your company’s future sales will be.

Your sales forecast should be realistic and achievable. Do not try to “game” the system by creating an overly optimistic or pessimistic forecast. Your goal should be to create a realistic sales forecast that can be used to guide your company’s future decision-making.

Creating a sales forecast is not an exact science, but there are a number of methods that can be used to generate realistic estimates. Some common methods include market analysis, competitor analysis, and customer surveys.

Create Multi-Year Financial Projections

When creating financial projections, it is important to generate projections for multiple years. This will give you a better sense of how your company’s financial performance is likely to change over time.

It is also important to remember that your financial projections are just that: projections. They are based on a number of assumptions and are not guaranteed to be accurate. As such, you should review and update your projections on a regular basis to ensure that they remain relevant.

Creating financial projections is an important part of any business plan. However, it’s important to remember that these projections are just estimates. They are not guarantees of future success.

Business Plan Financial Projections FAQs

What is a business plan financial projection.

A business plan financial projection is a forecast of your company's future financial performance. It should include line items for each type of asset and liability, as well as a total at the end.

What are annual income statements?

The Annual income statement is a financial document and a financial model that summarize a company's revenues and expenses over the course of a fiscal year. They provide a snapshot of a company's financial health and performance and can be used to track trends and make comparisons with other businesses.

What are the necessary financial statements?

The necessary financial statements for a business plan are an income statement, cash flow statement, and balance sheet.

How do I create financial projections?

You can create financial projections by making a list of assumptions, creating two scenarios (best case and worst case), conducting a ratio analysis, and being realistic.

Financial Planning and Analysis

Written by True Tamplin, BSc, CEPF®

Reviewed by subject matter experts.

Updated on September 02, 2023

Are You Retirement Ready?

Table of contents, overview of financial planning and analysis (fp&a).

Financial Planning and Analysis (FP&A) is the process businesses use to plan and monitor their financial activities. It merges data-driven analysis with strategic planning to ensure a company's fiscal well-being.

By diving into financial data, businesses can make informed decisions about their strategies and operations. This in-depth understanding enables firms to predict future trends and ready themselves accordingly.

Within any business setting, FP&A serves as the backbone for fiscal health and stability. Not only does it provide a clear snapshot of a company's present financial state, but it also helps predict future trajectories and potential challenges.

By ensuring a robust FP&A process, organizations can stay ahead of the curve, driving growth and sidestepping pitfalls that could otherwise go unnoticed.

Key Components of Financial Planning

Financial goals and objectives.

Every successful business journey begins with a clear destination in mind. Financial goals and objectives provide direction and a yardstick against which progress can be measured.

Whether it's achieving a specific revenue target or maintaining a desired profit margin , these aspirations push companies forward.

In setting these objectives, companies often look toward both short-term milestones and long-term visions. This balanced perspective ensures immediate tasks align with broader company aspirations, guiding every financial move.

Financial Projections and Budgets

Revenue forecasting.

Understanding potential revenue streams is a pillar of financial planning . Revenue forecasting allows businesses to anticipate incoming cash flow, ensuring they're well-prepared for both opportunities and challenges.

By examining past performance, market trends, and current operations, companies can develop realistic and actionable revenue predictions.

Expense Budgeting

In tandem with revenue forecasting is the equally crucial task of expense budgeting. This involves allocating resources to various business operations, ensuring that expenditure doesn't surpass income.

By keeping a close eye on outflows and setting limits, companies can maintain profitability and avoid the pitfalls of financial strain.

Capital Expenditure Planning

Investing in long-term assets, such as machinery or real estate , requires meticulous capital expenditure planning. It's about weighing the benefits of these assets against their costs and the potential financial returns they might bring.

Proper planning ensures that such investments bolster the company's bottom line over time and don't become financial burdens.

Risk Management and Contingency Planning

The business world is rife with uncertainties. Risks, both internal and external, can strike at any moment. Effective risk management involves identifying these potential threats, evaluating their likelihood and impact, and formulating strategies to mitigate them.

In conjunction, contingency planning is the creation of a structured approach detailing the steps to be taken if identified risks materialize. Having such a plan in place ensures that, in the face of adversity, a company can respond swiftly and decisively, minimizing potential damage.

Integration With Business Strategy

At its core, financial planning isn't just about crunching numbers—it's about aligning those numbers with a company's overarching strategy. Each financial decision should mirror the broader objectives of the business, ensuring coherence and strategic direction.

When finance and strategy walk hand-in-hand, companies can navigate the complex business terrain with purpose and clarity.

Essential Elements of Financial Analysis

Financial statement analysis, income statement analysis.

An income statement provides a snapshot of a company's profitability over a specific period. By dissecting revenues , costs, and expenses, businesses can gauge their operational efficiency and financial health.

Analyzing this statement helps identify patterns, underscoring areas of strength and potential concern.

Balance Sheet Analysis

The balance sheet , showcasing a company's assets , liabilities , and equity , is a testament to its financial stability . Delving into these elements offers insights into the company's liquidity , solvency, and overall net worth .

Regularly reviewing and analyzing the balance sheet can highlight potential vulnerabilities or areas ripe for improvement.

Cash Flow Statement Analysis

Cash flow is the lifeblood of any business. The cash flow statement breaks down the inflows and outflows from operations, investments, and financing.

Understanding this statement is pivotal for ensuring that a business remains solvent and has sufficient liquidity for both immediate needs and future investments.

Key Financial Ratios and Their Importance

Liquidity ratios.

Liquidity ratios , such as the current ratio or quick ratio , gauge a company's ability to cover its short-term obligations using its short-term assets.

These metrics offer insights into financial health, indicating whether a firm can handle its immediate liabilities without resorting to external financing.

Solvency Ratios

While liquidity focuses on the short-term, solvency ratios like the debt-to-equity ratio zooms out, providing a broader view of a company's long-term financial viability.

These ratios measure a company's capacity to meet its long-term debt obligations, ensuring sustainability in the grander scheme of business operations.

Profitability Ratios

Profitability metrics, including the return on assets or net profit margin , shed light on a company's ability to generate profits relative to its size or its assets. These ratios offer a clear picture of operational efficiency, revealing how well a company turns inputs into profits .

Key Financial Ratios and Their Importance

Variance Analysis and Performance Evaluation

Variance analysis is a technique used to assess the difference between expected and actual performance. By identifying these variances, companies can pinpoint areas that are outperforming or underperforming expectations.

This analysis offers a roadmap, guiding businesses towards areas needing attention or adjustment.

Performance evaluation, meanwhile, goes beyond just identifying variances. It involves a holistic review of operations, strategies, and outcomes.

Through this evaluation, companies can celebrate successes, learn from shortcomings, and recalibrate their strategies for future endeavors.

Trend Analysis and Comparative Analysis

Spotting trends can be a game-changer. Trend analysis involves examining financial data over a series of time periods to identify patterns or trajectories.

By recognizing these trends, businesses can forecast future scenarios and position themselves advantageously.

Comparative analysis, on the other hand, involves benchmarking a company's performance against others in the industry. Such comparisons provide context, showing where a company stands in the competitive landscape and highlighting areas for potential improvement.

Tools and Techniques Used in Financial Planning and Analysis

Financial modelling and simulation.

Financial models are mathematical constructs that represent a company's financial performance. These models, built using historical data, help in forecasting future financial scenarios.

Through simulations, businesses can play out different scenarios, understanding potential outcomes and making informed decisions accordingly.

Financial models and simulations are not static; they're dynamic tools that evolve with a company's needs.

As businesses grow, face new challenges, or diversify, these models adapt, offering fresh perspectives and insights into changing financial landscapes.

Scenario and Sensitivity Analysis

Scenario analysis delves into potential future events by considering various feasible outcomes or sequences of events. It's a 'what if' technique that enables businesses to strategize for a range of possible futures.

By analyzing different scenarios, companies can develop strategies flexible enough to pivot based on shifting circumstances.

Sensitivity analysis complements scenario analysis by determining how different values of an independent variable impact a particular dependent variable.

It's about gauging the 'sensitivity' of one variable in the presence of changes to another, enabling businesses to pinpoint areas of vulnerability or potential opportunity within their operations.

Benchmarking and Key Performance Indicators (KPIs)

Benchmarking is the practice of comparing business processes and performance metrics to industry leaders or best practices from other industries.

By understanding where a business stands relative to industry peers, companies can identify gaps in their processes and strive for excellence.

KPIs, on the other hand, are a set of quantifiable measures that companies or industries use to gauge or compare performance in terms of meeting their strategic and operational goals.

Utilizing KPIs effectively can provide a clear direction, maintain focus, and drive performance improvement across the organization.

Challenges in Financial Planning and Analysis

Balancing short-term and long-term goals.

One of the most intricate dances in finance is that of balancing immediate needs with long-term visions. Short-term objectives often demand quick results and can sometimes divert resources from long-term goals.

Companies must remain vigilant, ensuring that their desire for immediate gains doesn't jeopardize their future stability and growth.

Similarly, an overemphasis on long-term aspirations can lead to missed short-term opportunities or immediate challenges being overlooked.

The key lies in finding a balance where both short-term and long-term goals coexist harmoniously, driving the business forward.

Keeping Up With Technological Advancements

The digital age has ushered in a wave of technological innovations that have transformed the realm of FP&A.

While these advancements offer unprecedented opportunities for data analysis and strategy formulation, they also present a challenge: the need for constant adaptation.

Companies must be agile, ready to embrace new technologies while also ensuring that their teams are equipped with the necessary skills to leverage these tools effectively.

Moreover, with the rapid pace of technological change, there's the ever-present risk of investing in technology that might soon become obsolete. It requires businesses to have both foresight and adaptability, ensuring they remain at the forefront of the tech curve.

Ensuring Accuracy and Reliability of Data

In FP&A, data is king. The insights drawn from this data drive decisions that can make or break a business. However, the influx of massive volumes of data in today's digital age brings about the challenge of maintaining accuracy and reliability.

Erroneous data can lead to misguided strategies, potentially causing significant harm to a company.

Hence, businesses need robust data management systems and practices. It's not just about gathering data but ensuring that this data is accurate, relevant, and timely.

With reliable data in hand, FP&A professionals can craft strategies with confidence, knowing they're working from a solid foundation.

Continuous Monitoring and Adapting to External Factors

The external business environment is in constant flux. Factors like economic shifts, geopolitical events, or even sudden pandemics can have profound impacts on a company's financial standing.

For FP&A professionals, staying vigilant and adapting to these ever-changing external factors is paramount.

Through continuous monitoring, businesses can detect shifts early, enabling them to adapt strategies before a potential threat becomes a reality.

It's about proactive management, where businesses aren't just reacting to the world around them but are actively shaping their financial futures.

Best Practices in Financial Planning and Analysis

Adopting a holistic view of the business.

A segmented view of a company can lead to fragmented strategies. For FP&A to truly drive growth, a holistic approach is essential.

This involves understanding the interplay between different departments, processes, and strategies, ensuring that financial plans encompass the entirety of the business.

When FP&A professionals adopt a comprehensive view, they're better equipped to identify synergies, spot potential pitfalls, and ensure that financial strategies support overall business objectives.

It transforms FP&A from a mere support function to a central driver of business success.

Continuous Learning and Skill Development

The realm of FP&A is evolving, and with it, the skillsets required. For professionals in this field, continuous learning is not a luxury; it's a necessity.

Whether it's staying updated with the latest technological tools, understanding emerging financial theories, or honing analytical skills, ongoing skill development is crucial.

Encouraging a culture of learning within the FP&A department can lead to more innovative solutions, sharper insights, and a team that's ready to tackle the challenges of tomorrow.

Continuous skill development ensures that the FP&A function remains agile, adaptable, and at the forefront of financial innovation.

Leveraging Technology for Enhanced Insights

Modern FP&A is intertwined with technology. Tools like artificial intelligence, machine learning, and advanced analytics software can unearth insights that were previously unimaginable.

However, merely having access to these tools isn't enough. It's about leveraging them to their fullest potential, ensuring that they drive tangible results.

By integrating technology into their workflows, FP&A professionals can enhance accuracy, speed up processes, and delve deeper into data.

It transforms the role of FP&A, allowing professionals to move beyond mere number crunching to become strategic advisors, guiding businesses toward a prosperous future.

Fostering Collaborative Decision-Making

FP&A doesn't operate in isolation. Its insights and strategies impact every facet of a business. As such, collaborative decision-making becomes crucial.

By working closely with other departments, gathering input, and ensuring that everyone is on the same page, FP&A can craft strategies that are both comprehensive and effective.

Fostering a culture of collaboration also ensures buy-in from all stakeholders . When everyone feels involved in the financial planning and analysis process, there's a greater sense of ownership, driving collective efforts toward achieving the company's financial objectives.

Best Practices in Financial Planning and Analysis

Role of Financial Planning and Analysis in Decision Making

Support strategic initiatives.

At the core of any business strategy lies financial planning. FP&A plays a pivotal role in shaping and supporting strategic initiatives, ensuring they're both ambitious and feasible.

Whether it's entering a new market, launching a product, or restructuring operations, FP&A provides the financial backbone, ensuring these initiatives have the resources and planning they need to succeed.

Strategic initiatives, with their long-term focus, require meticulous financial analysis . FP&A professionals ensure that every strategic move is backed by solid financial reasoning, ensuring a higher likelihood of success.

Provide Insights for Investment Decisions

Where to invest and how much to allocate are questions that every business grapples with. These decisions can dictate the future trajectory of a company. FP&A, with its data-driven insights, plays a crucial role in guiding these investment choices .

By analyzing potential returns , weighing risks, and evaluating the broader financial landscape, FP&A professionals can offer invaluable insights. Their analyses ensure that investment decisions aren't just based on gut feelings but are rooted in solid financial logic.

Assist in Mergers and Acquisitions

Mergers and acquisitions (M&A) are complex endeavors, with significant financial implications. FP&A professionals are often at the heart of these processes, evaluating potential targets, conducting due diligence , and modeling post-merger scenarios.

Their analyses can uncover synergies, highlight potential challenges, and ensure that the financial aspects of the merger or acquisition align with the company's broader objectives.

In the intricate world of M&A, FP&A acts as both a compass and a safeguard, guiding companies towards successful integrations.

Inform Capital Allocation Decisions

How a company allocates its capital can be the difference between growth and stagnation. FP&A professionals play a crucial role in these decisions, ensuring that resources are directed toward the most promising and strategic avenues.

Through in-depth analyses, they can determine which departments, projects, or initiatives are most likely to offer substantial returns. Their insights guide top management, ensuring that capital allocation decisions bolster the company's financial health and drive long-term growth.

Role of Financial Planning and Analysis in Decision Making

Bottom Line

Financial Planning and Analysis (FP&A) stands as a cornerstone of any business's fiscal strategy and stability. It offers a perfect amalgamation of data-driven insights and strategic planning, enabling organizations to anticipate future trends and make informed decisions.

With components ranging from setting financial objectives to detailed risk management, FP&A provides a roadmap for businesses to monitor their financial health.

The analysis of financial statements , combined with essential financial ratios , ensures an understanding of a company's profitability and stability.

Meanwhile, tools such as financial modeling and scenario analysis facilitate decision-making in diverse scenarios.

FP&A's importance extends to key business decisions, including mergers and acquisitions and capital allocation, with a focus on continuous learning and leveraging technology.

In essence, FP&A is not just about numbers; it’s about aligning those figures with overarching business goals, ensuring coherence, growth, and prosperity in an ever-evolving business landscape.

Financial Planning and Analysis FAQs

What is financial planning & analysis (fp&a).

FP&A involves forecasting financial outcomes, analyzing financial data, and assisting in strategic decision-making for organizations.

Why is FP&A crucial for organizations?

FP&A provides insights into financial health, guides investment decisions, supports strategic initiatives, and ensures sustainable growth.

What are the primary tools used in FP&A?

Key tools include financial modeling, scenario analysis, benchmarking, and leveraging key performance indicators (KPIs).

What challenges are commonly faced in FP&A?

FP&A professionals grapple with balancing short-term and long-term goals, keeping up with technology, and ensuring data accuracy.

How does FP&A support mergers and acquisitions?

FP&A assists in evaluating potential targets, conducting due diligence, and modeling financial scenarios post-merger.

About the Author

True Tamplin, BSc, CEPF®

True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.

True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide , a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University , where he received a bachelor of science in business and data analytics.

To learn more about True, visit his personal website or view his author profiles on Amazon , Nasdaq and Forbes .

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Financial Planning & Analysis lead (FP&A)

About the role.

Major accountabilities:

Key contributor to the Leadership Therapeutic Areas (“TA”) assigned
Critical member of the TA Management Team – helps to formulate strategies, guides investment, and implement actions that help to gain market share and increase profitability.
Setting the tone for good financial practices within the BU
Maintenance of the TA’s relationship with the local CPO finance team and specifically with the CCFO

2. Leader of Financial Planning

Lead the Budget, Latest Estimation and Latest Outlook processes and discussions; integrate and coordinate financial processes with the Marketing planning processes at the local level
Well thought-out and high-quality plans with transparency of assumptions and analyses of risks and opportunities
Coordinated with all members of the TA management team (e.g., marketing, sales, medical)
Also coordinated with the CPO (e.g., allocations, or on universal assumptions such as inflation rates)
Challenging all contributors (including TA Head) to the budget/LE on the underlying assumptions to Budget/LE; pushing back on the team when appropriate
Attention to forecasting accuracy for both sales and expenses (monthly)
Participation in the long-term planning of the business through the Strategic Planning process
Assisting in preparation of Budget/LE presentations for Regional Team
Work closely with the local Marketing, Sales, Medical and Market Access teams sharing responsibility of formulating business strategies, guide investment and resource allocation, monitoring commitment, implement actions, shared approval responsibility. 3. Analysis/Reporting of Financial Performance:
Full ownership of and responsibility for all aspects of the IMI BU P&L.
Analysis of Sales and Market Share (including trending of data) to provide IMI management with insights into the business, early detection of risks/opportunities vs. plan, etc.
Analysis and understanding of the commercial aspects of the business, e.g., discounts per channel, per customer and per brand. Benchmark selected key indicators with other Novartis businesses and/or other international companies
Analysis and control of operational expenses, incl. analysis of variations to the authorized budgets / LEs.
Managing the headcount analysis and control
Review and follow-up as needed on aging of receivables (DSOs), surpluses or deficits of product inventories (stock-in-trade), IMI’s impact on overall CPO working capital and/or country asset limits, and payables to vendors
Evaluation of the BU’s Risks and Opportunities, including a latest outlook for the month/quarter/year; also identification and implementation of gap closing actions.
Communication of unexpected events affecting performance, or impacting key assumptions, in a transparent and timely manner.
Preparation of regular, comprehensive performance reports (including Business Review documents and monthly Executive Summary Reports) to the Regional Office on timely basis

4. Analysis of Business Proposals/investments.

Financial evaluation of business proposals or projects for the assigned TAs. (e.g., Field Force expansion, launching of a new product or indication).
Financial evaluation of Marketing investments and allocation of funds among potential projects to maximize return for the assigned TAs. Use of appropriate analytical tools as necessary.
Ad hoc analyses as may be necessary.

5. Strategic Planning

Prepare for IMI portfolio by managing the sensitivity of the external relationships including government and distributors where the market has a number of healthcare, and funding systems and the pricing for these new models will have a significant positive/negative implication on the Gulf (GCC) countries.

6. Management Cash Flow

Lead the Budget, Latest Estimation and Latest Outlook processes and discussions
Achieving the MCF%
Explain MCF variances, opportunities, and challenges through budget and financial forecasts for use in Global and Regional.
Application of general Balance Sheet and Cash Flow knowledge in support of the business 7. Other
Identify and utilize best practices in FP&A and disseminate them within the Organization.
Ensure the IMI is compliant with internal control standards, reporting requirements, accounting guidance, and be observant for any potential CoC issues
Assist with audits where required, and where follow-up is needed ensure compliance with / implementation of the agreed-to action plans.
Assist with development / implementation of planning and analysis tools and/or systems
Perform assigned NFCM controls with high quality and on a timely manner
Ensure Saudi talent development and succession planning to meet the Saudization milestones; coach, guide and mentor FP&A associate within the country, including upscaling capabilities.
Lead successful and efficient interaction with Distributors and Customers.
Collaborate with Internal Audit and FCCR team to ensure consistent financial data reporting processes and results.
Lead the Monthly Local and Regional Business Review.
In the absent of the FRA team in the country, FP&A Lead plays major roll to ensure all the monthly reporting are meeting local expectations.
Support FRA team in the monthly cross charge for Novartis AG (NCC changes).
Support the FRA team in the monthly closing.
Accompaniment throughout the institutional tender process. Ensures quick turnaround of ad-hoc analysis, providing accurate information / analysis required for timely decision-making.
Proactively carry out value added analyses on financial data, supporting and testing information provided by Global, Regional and Local financial officers. Assist with the development of detailed budget and financial forecasts for use in Global and Regional, as well as Country, Business Franchise, and Business Unit planning.
Proactively interface with financial officers in other Country organizations to obtain financial best practices and in market data results, benchmarking country results and methods against ones from other markets.
Drive continuous learning within the Country by performing post implementation financial analyses on past initiatives and sharing results across the organization Ensure consistency and interoperability between different financial reporting systems.
Support CCFO to coordinate with cooperate tax department to resolve all tax related issues and assist to resolve all financial queries and statement analysis.
Providing leadership, direction and management of the finance and accounting team
Providing strategic recommendations to the CPO leadership members
Establishing and developing relations with senior management and external partners and stakeholders.

Key Performance Indicators (Indicate how performance for this role will be measured)

Financial and Business Results:

Budgets, latest estimates and rolling forecast
Impact of early warning and value-added analyses on Country profit
Sales and market share targets (sales vs. targets, market share growth, market share, absolute cash growth and relative cash growth – as specified by specific brand).
Contact rate and coverage (daily contact rate vs. benchmark)
Meetings spend vs. budget
Therapy/product knowledge including tertiary evaluations of progress
Delivery of customer centric activities – dependent on individual and in agreement with territory sales manager
Territory administration – reports are completed accurately and to timescales
Delivering the MCF% and the Productivity Targets

Strategy/Market Focus :

Internal customer satisfaction with quality, appropriateness, and timeliness of financial analyses provided by the FP&A group

Operational Excellence:

Reliability, timeliness and accuracy of budgetary and financial forecasts
Accuracy of early-warning system and results
Satisfaction of internal customers with timeliness and depth of reporting information provided.

Minimum requirements:

Degree educated in financial management, Accountant, Desirable degrees: MBA, Chartered/Certified Accountant. CMA AND CFA is plus.
Fluency in English is prerequisite, while knowledge of Arabic and would be an advantage.
Significant (7-10 years) experience in budgeting and/or controlling positions or within pharmaceuticals industry.
Experience designing and operating financial reporting and forecasting systems
Excellent analytical ability
Strong written and oral communication skills, and ability to clearly present financial data in reports distributed to Regional and Global officers.
Saudi National is a must as per local labor law mandate.

Why Novartis: Helping people with disease and their families takes more than innovative science. It takes a community of smart, passionate people like you. Collaborating, supporting and inspiring each other. Combining to achieve breakthroughs that change patients’ lives. Ready to create a brighter future together? https://www.novartis.com/about/strategy/people-and-culture

Join our Novartis Network: Not the right Novartis role for you? Sign up to our talent community to stay connected and learn about suitable career opportunities as soon as they come up: https://talentnetwork.novartis.com/network

Benefits and Rewards: Read our handbook to learn about all the ways we’ll help you thrive personally and professionally: https://www.novartis.com/careers/benefits-rewards

Novartis is committed to building an outstanding, inclusive work environment and diverse teams' representative of the patients and communities we serve.

A female Novartis scientist wearing a white lab coat and glasses, smiles in front of laboratory equipment.

Small Enterprise Planning

Small enterprise planning is an exhaustive process that helps businesses define their vision, direction, and objectives. It involves conducting market research to identify opportunities and gaps, setting realistic financial goals, and establishing key performance indicators to measure progress. A strong management team is vital for driving growth and profitability, and effective management involves prioritizing tasks, allocating resources, and delegating responsibilities. By evaluating market opportunities, identifying risks, and building strategic partnerships, small enterprises can stay competitive and innovative. By exploring each of these critical elements, businesses can create a tailored plan that propels them towards success.

Table of Contents

Defining Your Business Vision

Every successful business starts with a clear and well-defined vision that outlines its purpose, objectives, and overall direction. This vision serves as a guiding force, influencing every aspect of the business, from strategic planning to daily operations. A well-crafted vision statement provides a sense of direction, unity, and purpose, guaranteeing that all stakeholders are working towards a common goal.

At the heart of a business vision are its core values, which define the organization's character and culture. These values shape the company's behavior, decision-making, and interactions with customers, employees, and partners. By establishing a unique identity, a business can differentiate itself from competitors, build a loyal customer base, and create a lasting brand reputation.

A well-defined vision also enables businesses to establish measurable objectives, allocate resources effectively, and make informed decisions. By regularly reviewing and refining their vision, entrepreneurs can confirm their business remains relevant, competitive, and aligned with their long-term goals. By doing so, they can create a solid foundation for sustainable growth and success.

Assessing Market Opportunities

When evaluating market opportunities, small enterprises must conduct thorough market research analysis to gather insights on their target audience, industry trends, and competitors. This analysis helps identify business gaps in the market, which can be leveraged to create a unique value proposition and competitive advantage. By understanding these opportunities, entrepreneurs can develop strategies to capitalize on them and drive business growth.

Market Research Analysis

Four key aspects of market research analysis are essential for evaluating market opportunities: market size, growth potential, competition, and customer needs. These aspects provide a thorough understanding of the market landscape, enabling small enterprises to make informed decisions.

To accurately assess market opportunities, data validation is imperative. This involves verifying the accuracy and reliability of market data to confirm that it is a true representation of the market. This validated data can then be used to identify customer segments that align with the enterprise's products or services. Customer segmentation involves dividing the market into distinct groups based on demographics, needs, and preferences. By understanding these segments, small enterprises can tailor their offerings to meet the specific needs of their target market. This targeted approach increases the likelihood of success and helps small enterprises to differentiate themselves from competitors. By analyzing market research data, small enterprises can identify zones of opportunity and develop effective strategies to capitalize on them.

Identify Business Gaps

One crucial step in evaluating market opportunities is to identify business gaps, which are sectors where customer needs are not adequately met by existing products or services. This process involves conducting a gap analysis to pinpoint sectors where customers are not satisfied with current offerings. A thorough gap analysis can help small enterprises uncover potential opportunities to innovate, improve, or create new products or services that meet customer needs more effectively.

To identify business gaps, small enterprises can conduct a SWOT review, which involves analyzing their strengths, weaknesses, opportunities, and threats. This review can help identify sectors where the enterprise can leverage its strengths to capitalize on opportunities, while mitigating weaknesses and threats. Additionally, market research and customer feedback can provide valuable insights into customer needs and preferences, helping small enterprises to identify gaps in the market.

Identifying Key Performance Indicators

Measuring business performance requires pinpointing key metrics that matter, which is where identifying Key Performance Indicators (KPIs) comes into play. KPIs serve as a benchmark to evaluate an organization's progress towards achieving its objectives. To identify relevant KPIs, small enterprises must prioritize high-quality data and metric alignment. High-quality data is vital as it verifies that the insights derived from KPIs are accurate and reliable. Metric alignment, on the other hand, involves selecting KPIs that are aligned with the organization's overall goals and objectives.

When identifying KPIs, small enterprises should consider both financial and non-financial metrics. Financial metrics may include revenue growth, profit margins, and return on investment, while non-financial metrics may include customer satisfaction, employee engagement, and market share. By emphasizing high-quality data and metric alignment, small enterprises can identify KPIs that provide actionable insights, enabling them to make data-driven decisions and drive business growth. By regularly tracking and analyzing KPIs, small enterprises can refine their strategies, optimize operations, and achieve sustainable success.

Setting Realistic Financial Goals

Setting realistic financial goals is a vital aspect of small enterprise planning, as it enables businesses to establish a clear direction and prioritize resources effectively. To achieve this, entrepreneurs must define specific, measurable, and attainable financial objectives that align with their overall business strategy. By doing so, they can create a roadmap for financial success, concentrating on key sectors such as revenue projections and expense management.

Financial Goal Setting

Establishing realistic financial goals is a crucial step in small enterprise planning, as it enables entrepreneurs to prioritize resources, allocate budget, and track progress towards achieving business objectives. By setting specific, measurable, achievable, relevant, and time-bound (SMART) financial goals, entrepreneurs can create a roadmap for their business's financial success.

Three key considerations for setting realistic financial goals are:

Cash Flow Management : Account for regular cash inflows and outflows in your financial goals, avoiding cash flow crises that can cripple your business.
Emergency Funding : Set aside a contingency fund to cover unexpected expenses or revenue shortfalls, providing a safety net for your business in the face of uncertainty.
Prioritized Allocation : Allocate resources strategically, concentrating on high-impact zones that drive business growth and profitability, while minimizing waste and inefficiencies.

Revenue Projections Matter

Accurate revenue projections serve as the foundation of realistic financial goals, providing entrepreneurs with a clear understanding of their business's potential earnings and informing strategic decisions about resource allocation and investment. By estimating future revenue, small enterprises can create a roadmap for achieving their financial objectives, identifying opportunities for growth, and mitigating potential risks.

Revenue projections also play a critical function in managing cash flow, providing that businesses have sufficient funds to meet their financial obligations. This involves identifying and diversifying revenue streams, reducing dependence on a single source of income, and developing strategies to stabilize cash inflows.

Moreover, realistic revenue projections enable entrepreneurs to set achievable targets, allocate resources effectively, and make informed decisions about pricing, marketing, and production. By setting realistic financial goals, small enterprises can avoid overextension, prioritize investments, and concentrate on high-return initiatives. By doing so, they can provide for sustainable growth, improved profitability, and long-term success.

Building a Strong Management Team

A small enterprise's long-term success hinges on the ability to assemble and maintain a cohesive management team that shares a common vision and is equipped to drive the organization forward. A strong management team is the backbone of any successful enterprise, providing the necessary leadership, guidance, and proficiency to navigate the complexities of the business landscape.

To build a strong management team, consider the following key elements:

Team Dynamics : Foster an environment of open communication, trust, and respect among team members to facilitate effective collaboration and decision-making.
Leadership Pipeline : Develop a pipeline of future leaders by identifying, mentoring, and training high-potential employees to take on key responsibilities and positions.
Diverse Skill Sets : Assemble a team with diverse skill sets, proficiency, and experiences to bring a range of perspectives and insights to the table.

Developing a Marketing Strategy

Crafting a tailored marketing strategy is vital to effectively promoting a small enterprise's products or services, as it enables the business to pinpoint its target audience, differentiate itself from competitors, and allocate resources efficiently. A well-crafted strategy helps small enterprises navigate the ever-evolving digital landscape, where consumer behaviors and preferences are constantly shifting. By understanding the target audience's needs, preferences, and pain points, small enterprises can develop targeted marketing campaigns that foster brand loyalty and drive sales.

A thorough marketing strategy should span both online and offline tactics, including social media marketing, content marketing, email marketing, and traditional advertising. Small enterprises should leverage data and analytics to measure the effectiveness of their marketing efforts, making adjustments as needed to optimize their strategy. By doing so, they can optimize their return on investment and build a strong brand reputation that resonates with their target audience. Ultimately, a well-executed marketing strategy is imperative for small enterprises to stay competitive, drive growth, and achieve long-term success.

Managing Operational Efficiency

Efficiently managing day-to-day operations is crucial for small enterprises to optimize resource allocation, reduce costs, and enhance overall productivity. This involves streamlining processes, eliminating inefficiencies, and leveraging technology to improve performance. By doing so, small enterprises can free up resources to focus on growth and innovation.

To achieve operational efficiency, small enterprises should consider the following strategies:

Process Automation : Automate repetitive tasks and processes to reduce manual errors, increase speed, and lower costs.
Supply Chain Optimization : Analyze and optimize supply chain operations to reduce lead times, lower inventory costs, and improve delivery times.
Performance Metrics Tracking : Establish key performance indicators (KPIs) to measure operational efficiency, identify areas for improvement, and track progress over time.

Identifying and Mitigating Risks

Regularly assessing potential risks and vulnerabilities is essential for small enterprises to proactively minimize the likelihood of disruptions and ensure business continuity. This involves conducting a thorough risk assessment to identify potential threats, such as operational failures, supply chain disruptions, and cyber attacks. By understanding the likelihood and potential impact of these risks, small enterprises can develop strategies to mitigate them.

Insurance strategies can play a crucial role in mitigating risks. Small enterprises should consider investing in insurance policies that cover business interruption, liability, and property damage. This can provide financial protection in the event of unexpected disruptions or losses. Additionally, small enterprises can implement risk management practices, such as diversifying suppliers, implementing backup systems, and conducting regular security audits. By taking a proactive approach to risk management, small enterprises can reduce the likelihood of disruptions and ensure business continuity. A comprehensive risk management plan can help small enterprises to stay competitive, maintain customer trust, and achieve long-term success.

Building Strategic Partnerships

By mitigating risks and safeguarding business continuity, small enterprises can concentrate on building strategic partnerships that foster growth, innovation, and competitive advantage. These partnerships are crucial in today's competitive landscape, as they enable small enterprises to access new markets, technologies, and skills that would be difficult to develop in-house.

To build effective strategic partnerships, small enterprises should focus on the following key areas:

Developing a robust Partner Network : This involves identifying and collaborating with partners who share similar values and goals, and who can provide access to new markets, technologies, or skills.
Forming Joint Ventures : Joint ventures enable small enterprises to pool resources, share risks, and leverage each other's strengths to achieve specific business objectives.
Establishing clear partnership agreements : This involves defining roles, responsibilities, and expectations to ensure that partnerships are mutually beneficial and sustainable.

Monitoring and Evaluating Progress

Effective small enterprise planning relies on the systematic monitoring and evaluation of progress to confirm goals and objectives are being met. To achieve this, entrepreneurs must establish clear progress tracking methods and regularly analyze performance metrics to identify sectors of improvement. By doing so, they can adjust their strategies and make data-driven decisions to drive business growth and success.

Progress Tracking Methods

A vital aspect of successful small enterprise planning involves implementing progress tracking methods to monitor and evaluate the achievement of set goals and objectives. This enables entrepreneurs to identify strengths and weaknesses, make informed decisions, and adjust their strategies accordingly. Effective progress tracking methods help small enterprises stay motivated, committed, and directed towards their objectives.

Three key progress tracking methods are:

Task Management Tools : Leverage digital tools such as Trello, Asana, or Todoist to track and manage tasks, projects, and deadlines. These tools enable entrepreneurs to visualize their workflow, prioritize tasks, and collaborate with team members.
Habit Formation : Establish habits that support goal achievement, such as regular progress meetings, weekly reviews, or daily journaling. Consistency is key to developing habits that drive progress and accountability.
Regular Reflection : Schedule regular time for introspection and reflection, allowing entrepreneurs to assess their progress, celebrate successes, and identify sectors for improvement.

Performance Metric Analysis

Through the systematic analysis of performance metrics, entrepreneurs can objectively evaluate their progress, pinpoint aspects of improvement, and make data-driven decisions to propel their small enterprise forward. This analysis is vital in monitoring and evaluating progress, as it provides insights into the effectiveness of strategies and initiatives. To guarantee accurate analysis, entrepreneurs must prioritize data quality, verifying that the metrics used are reliable, relevant, and timely. A well-structured metric hierarchy is also vital, as it helps to categorize and organize metrics into meaningful groups, facilitating a thorough understanding of performance.

Frequently Asked Questions

How do i balance short-term needs with long-term goals?.

To balance short-term needs with long-term goals, prioritize cash flow management and strategic resource allocation, guaranteeing immediate necessities are met while allocating sufficient resources to drive long-term growth and sustainability.

Can a Small Business Owner Handle Planning Alone?

While a solo entrepreneur may be capable of handling planning alone, they may still face challenges, particularly if they possess skill gaps in aspects such as strategic planning, finance, or marketing, which can hinder their ability to develop a thorough plan.

What Is the Ideal Business Planning Frequency?

Determining the ideal business planning frequency involves striking a balance between regularity and adaptability. Quarterly reviews provide a structured framework, while incorporating flexible schedules allows for adjustments in response to changing market conditions and priorities.

How Do I Handle Unexpected Changes in the Market?

When confronting unexpected market changes, conduct a thorough risk assessment to identify potential threats and opportunities. Foster market flexibility by regularly reviewing and adapting business strategies to maintain resilience and responsiveness in a dynamic market environment.

Is It Necessary to Involve Employees in the Planning Process?

Involving employees in the planning process fosters Employee Engagement, boosts Team Morale, and leverages diverse perspectives, ultimately leading to more effective decision-making and a more resilient organization.

IMAGES

Business Financial Analysis
How to Write the Financial Plan in Business Plan?
50 Professional Financial Plan Templates [Personal & Business] ᐅ
Financial Analysis Example For Complete Beginners
50 Professional Financial Plan Templates [Personal & Business] ᐅ
How to Write the Financial Plan in Business Plan?

COMMENTS

The Financial Analysis for a Small Business Plan
The financial analysis section should be based on estimates for new businesses or recent data for established businesses. It should include these elements: Balance sheet: Your assumed and anticipated business financials, including assets, liabilities, and equity. Cash-flow analysis: An overview of the cash you anticipate will be coming into ...
How to Write the Financial Section of a Business Plan
Use the numbers that you put in your sales forecast, expense projections, and cash flow statement. "Sales, lest cost of sales, is gross margin," Berry says. "Gross margin, less expenses, interest ...
How to Write a Great Business Plan: Financial Analysis
Most business plans include at least five basic reports or projections: Balance Sheet: Describes the company cash position including assets, liabilities, shareholders, and earnings retained to ...
How to Prepare a Financial Plan for Startup Business (w/ example)
7. Build a Visual Report. If you've closely followed the steps leading to this, you know how to research for financial projections, create a financial plan, and test assumptions using "what-if" scenarios. Now, we'll prepare visual reports to present your numbers in a visually appealing and easily digestible format.
Business Plan Financial Templates
This financial plan projections template comes as a set of pro forma templates designed to help startups. The template set includes a 12-month profit and loss statement, a balance sheet, and a cash flow statement for you to detail the current and projected financial position of a business. Download Startup Financial Projections Template.
Write your business plan
A good business plan guides you through each stage of starting and managing your business. You'll use your business plan as a roadmap for how to structure, run, and grow your new business. It's a way to think through the key elements of your business. Business plans can help you get funding or bring on new business partners.
Financial Analysis Guide for Small Businesses
A Federal Reserve study noted 78% and 92% of companies with above-average and excellent financial health, respectively, had annual income of at least $1 million. Forty percent of businesses with poor financial health, on the other hand, had revenue of less than $100,000. Additionally, the study found 90% of organizations with excellent ...
Business Plan Essentials: Writing the Financial Plan
The financial section of your business plan determines whether or not your business idea is viable and will be the focus of any investors who may be attracted to your business idea. The financial section is composed of four financial statements: the income statement, the cash flow projection, the balance sheet, and the statement of shareholders ...
How to Write a Financial Plan: Budget and Forecasts
Financial ratios and metrics. With your financial statements and forecasts in place, you have all the numbers needed to calculate insightful financial ratios. While including these metrics in your financial plan for a business plan is entirely optional, having them easily accessible can be valuable for tracking your performance and overall ...
Basics Of A Business Plan Financials Section
3. Equity: Total assets minus total liabilities (Assets = liabilities + equity.) Analysis. It's good to offer readers an analysis of the three basic financial statements — how they fit ...
Financial Analysis: Definition, Importance, Types, and Examples
Financial analysis is the process of evaluating businesses, projects, budgets and other finance-related entities to determine their performance and suitability. Typically, financial analysis is ...
How To Conduct Financial Analysis for Your Company
How to do a financial analysis. 1. Collect your company's financial statements. Financial analysis helps you identify trends in your business's performance. To get the best insights, compare your business performance over time. Gather your recent financial statements, including your balance sheets, income statements, and cash flow statements.
4 Steps to Creating a Financial Plan for Your Small Business
A financial plan is an integral part of an overall business plan, ensuring financial objectives align with overall business goals. It typically contains a description of the business, financial statements, personnel plan, risk analysis and relevant key performance indicators (KPIs) and ratios.
6 Elements of a Successful Financial Plan for a Small Business
A business financial plan typically has six parts: sales forecasting, expense outlay, a statement of financial position, a cash flow projection, a break-even analysis and an operations plan. A good financial plan helps you manage cash flow and accounts for months when revenue might be lower than expected. It also helps you budget for daily and ...
Creating a Small Business Financial Plan
Financial Plan Overview. A financial plan is a comprehensive document that charts a business's monetary objectives and the strategies to achieve them. It encapsulates everything from budgeting and forecasting to investments and resource allocation.. For small businesses, a solid financial plan provides direction, helping them navigate economic challenges, capitalize on opportunities, and ...
Financial Statement Analysis: How It's Done, by Statement Type
Financial statement analysis is the process of reviewing and evaluating a company's financial statements (such as the balance sheet or profit and loss statement), thereby gaining an understanding ...
How to Conduct a Strategic Financial Analysis for Your Business
Here are the five steps you'll want to take when conducting a strategic analysis of your financial statements. 1. Compare your forecast to your actuals monthly. So, if you're reviewing your business financials regularly, you're off to a good start. But to get even more value out of that financial review, you need to start comparing your ...
Business Plan
A business plan is a document that contains the operational and financial plan of a business, and details how its objectives will be achieved. It serves as a road map for the business and can be used when pitching investors or financial institutions for debt or equity financing. A business plan should follow a standard format and contain all ...
Writing a Business Plan—Financial Projections
The financial section of your business plan should include a sales forecast, expenses budget, cash flow statement, balance sheet, and a profit and loss statement. Be sure to follow the generally accepted accounting principles (GAAP) set forth by the Financial Accounting Standards Board, a private-sector organization responsible for setting ...
The Complete Guide to Creating a Financial Analysis
Professionals investing in small businesses use financial analysis findings for business success evaluation. They examine past and current financial statements to determine investment expectations/value. For small business owners, financial analysis can also help you weigh the impact that financial decisions might have on your company.
Financial Section of Business Plan
Generally, the financial section is one of the last sections in a business plan. It describes a business's historical financial state (if applicable) and future financial projections. Businesses include supporting documents such as budgets and financial statements, as well as funding requests in this section of the plan. The financial part of ...
Business Plan Financial Projections
There are three main financial statements that you will need to include in your business plan financial projections: 1. Income Statement Projection. The income statement projection is a forecast of your company's future revenues and expenses. It should include line items for each type of income and expense, as well as a total at the end.
Financial Planning and Analysis
Financial Planning and Analysis (FP&A) is the process businesses use to plan and monitor their financial activities. It merges data-driven analysis with strategic planning to ensure a company's fiscal well-being. By diving into financial data, businesses can make informed decisions about their strategies and operations.
Financial Planning & Analysis lead (FP&A)
Analysis/Reporting of Financial Performance: Full ownership of and responsibility for all aspects of the IMI BU P&L.Analysis of Sales and Market Share (including trending of data) to provide IMI management with insights into the business, early detection of risks/opportunities vs. plan, etc.Analysis and understanding of the commercial aspects ...
remote financial planning & analysis analyst jobs
1,634 Remote Financial Planning & Analysis Analyst jobs available on Indeed.com. Apply to Director of Financial Planning and Analysis, Quality Assurance Analyst and more! ... Act as liaison between Business Continuity Planning and Systems regarding department needs. Assist with FedLine Advantage/FedLine Web requests relating to access ...
Small Enterprise Planning
This analysis helps identify business gaps in the market, which can be leveraged to create a unique value proposition and competitive advantage. ... and time-bound (SMART) financial goals, entrepreneurs can create a roadmap for their business's financial success. Three key considerations for setting realistic financial goals are ...
The 2024 Trump Campaign Policy Proposals: Budgetary, Economic and
The 2024 Trump presidential campaign has endorsed several tax-related policy proposals. The Trump campaign supports extending the expiring provisions of the 2017 Tax Cuts and Jobs Act (TCJA) and recommends additional reductions in the corporate tax rate to 15 percent.In addition, the Trump campaign favors eliminating income taxes on Social Security benefits.