Rookie FP&A Mistakes

What's a rookie FP&A mistake?

Not connecting your forecast to actual results.

A forecast's primary purpose is not to impress an investor...

It is a tool to help you run your business.

This can stem from:

1️⃣ A forecast created by a guru that's too complex for a team to manage after they're gone

2️⃣ A forecast that is not mapped to the chart of accounts

3️⃣ Bad or muddy actuals - not enough granularity in the results data

What's the solution?

Ensure your forecast and actuals are apples : apples...

and that the forecast is manageable by the people who will be using it.

Look at your forecast as a tool - if it's not useful, fix it.

If your forecast has channels, but your actuals are only recorded at the account level, you can't look at budget-to-actual variances by channel.

If things are too complex, SIMPLIFY.

You can always add more complexity later.

Usefulness > Fanciness