rcpenner logo name only


The Difference Between Budgets and Forecast


Do you own a business? If you answered yes, then this is an article you don’t want to miss. Business owners more often than not have little knowledge of where their company is in regard to their financial health. Meaning they have no idea if the company is doing well or not and if not what they will have to do to improve. This is where an accountant like me can help, with budgets and forecasts.


Budget Planning 

Contact me for a FREE consultation:https://rcpenner.com/contact

Budgets and forecasts are similar financial tools that accountants use to establish plans for a company’s future. These tools enable us to see what is happening now versus what can/will happen in the future, whether your company is in a good financial state or not. Then once this information has been gathered a plan of action is put in place.

 Do you know if your company is meeting your financial goals? If not, I can help you find this information. So, let’s look at the differences between a budget and a forecast and why you need to do both.

 1. A budget reveals the shape a company is in financially within the span of a year.

 2. A forecast uses past historical data to predict a company’s future financial outcomes.

The purpose of a company having a budget and forecast is to help strategize and plan for the future and align the company goals across the organization.

 Both budgeting and forecasting are very important components of every company’s growth. This is needed especially during periods of change within a company. Click the link for access to a free excel budgeting spreadsheet: https://best-excel-tutorial.com/59-tips-and-tricks/248-company-budget


Budgeting Tips


Below are 2 main reasons a budget is important:

 1. Budgeting is an important tool for decision making

 2. A great way to monitor business performance


2 main reasons forecasting is valuable to businesses:

 1. A forecast is able to help you make informed decisions.

 2. With these decisions you can then develop a strategy.


When you first open your business, it is vitally important that you know what your financial situation is. Hiring someone with the skill and expertise in finance is extremely important, especially if you don’t know anything about budgeting and aren’t able to forecast where the company will go in the future. This is when you will definitely need a professional in your corner to help guide you.

 As always thank you for taking the time to read my blog. I truly hope it has helped.


Rebecca C Penner CPA, CGA