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
Коментарі