Financial forecasting and planning - related controls

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elements of process control economic and social warehouse are planning and forecasting.They are used to determine the most appropriate areas of economic development, to adjust the rate of growth of certain industries.Financial forecasting and planning - the concept is not identical to each other, they are designed for different tasks.Financial forecasting and planning are very important both for individual companies and for the whole country, because these controls are creating conditions for the realization of tasks.

Broadly speaking, financial forecasting aimed at studying the expected future economic conditions.Forecasting develops strategies to ensure sustainability of the company and determines the direction of capital investments, as well as articles for the financing of costs.In a narrow sense, the term "prediction" is used for calculations in the preparation of financial plans, for example, in predicting sales to forecast the cost of expenses.Forecasting gives certain elasticity calculations, allows to bring amendments in connection with the changed circumstances.

Financial forecasting and planning are also important for external users of such information.For example, banks have forecasting the financial condition of enterprises creditors.Methods of assessing the likelihood of deterioration in the financial condition allows you to quickly react to predictions of bankruptcy and take appropriate action.Depending on the results of assessment of the bank, the company can be found to be insolvent, and therefore, it can be offered options to restore the solvency.

Financial forecasting creates prerequisites for financial planning.Depending on the term, the forecast can be medium and long term.Financial forecasting determines the ability to manage financial flows and is preceded by planning.

One of the key tools of economic management is planning.Uniform planning principles do not exist, the financial plan synchronizes enrollment and spending, and every organization in the process of planning, based on their experience and needs, in particular, estimated sufficiency of funds for financing future activities of the enterprise.

At the national level apply the principles of good management of public finances, which provide a stable implementation of state programs in the social sphere.They include: tax and fiscal transparency, long-term sustainability of the country's budget, an effective system of relations between budgets, consolidation of the budgetary process, financial planning for the medium term, budgeting, with an emphasis on results, financial control and reporting.These principles exist in the format of a unified system of management of public finances, which must constantly evolve and adapt to changing conditions and tasks.

Financial Plans are divided into: current, and operational perspective.The significance of the decisions taken in the planning extends to long term.The long-term plan is a structure whose constituent elements are short-term plans.If we talk about the enterprises, they are mostly due to lack of expertise and time, using short-term planning, ie one year ahead.The annual budget is divided into quarterly and monthly plans.Financial forecasting and planning in enterprises can be carried out differently, depending on the size and value of the organization, but always aimed at the formation and realization of their goals in the future.