Critical for Financial Planning

The main strategy is to know deeply, especially if growth plans are and the competitive (likely actions of competitors and the company’s competitive position) in which to operate.

Understanding the likely future economic environment. This is reflected in the key assumptions of economic growth, inflation, exchange rates, interest rates, and those that are needed to make the financial projection.


Financial Projection needs a base from which to depart. This database is the history of the company and specifically, that the financial projection of the numerical results we need the Statement of Financial Position or Balance Sheet of the previous year. At this point the Financial Planning is an extrapolation of the story. This, the story gives us the information that is inherited to the future, for example the amount of existing debt and repayment schedules. This is taken into account necessarily. The story also gives us the experience of how they have behaved according to certain other variables but this is not all there is to do. From the past we take what is relevant and necessary for the future and this, all changes are made that involve business strategies and operational plans.


Once you have the sales and cost of sales, or the contribution margin, may begin to see indicators for comprehensive rates, compared to history, to “benchmarking” and other types of analysis, for example, a contribution margin analysis by product or product line.
Already having sales, cost of sales or contribution margin, selling expenses and administrative expenses leads to the determination of operating income. This is an ideal time to take a break soon on the road and make a careful analysis of the results. This is the heart of the business and the analysis is made in this part can identify those concepts of cost or expense which may sensitize to see the impact on profits and then in the cash flow. They can also analyze the relevant indicators and to “benchmarking” with competitors or the industry in general.

A financial projection is the ideal way to see the effect of growth or in the case of divestment of assets. Strategic investments or growth included in the projection are those that are consistent with the business strategy. In this stage can not stop thinking about whether there will be resources for funding. This will be resolved at a later stage of the analysis. We also estimate all investments, called normal investment practice, whose purpose is to maintain current operating conditions in optimal conditions.


Finally, the model has to balance sources and uses of resources. The end result is adjusted according to the goals and objectives of the company.

The reports resulting in financial planning, are the financial statements (results, flow and financial situation), in addition to indicators, summary tables, graphs and all that ask for the address of the company. Must be an additional product, the calculation of the value of the company.

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