Replacing the traditional budget with a rolling forecast

10/15/2013 | Journal of Accountancy print issue

Amid rapidly changing business conditions, traditional budgets often end up as a snapshot of the past, rather than a forecast of expected costs. Companies increasingly are adopting a rolling forecast in addition to, or even to supplant, the traditional budget. This article discusses how a forward-looking forecast can help companies react more quickly to real-time risks and opportunities. One challenge for finance chiefs looking to adopt a forward-looking forecast, however, is communicating to managers how the change would benefit the organization. The article suggests four ways for companies to embrace a rolling forecast.

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