hi everyone, can someone help explain to me the difference between a company budget model vs. forecast model? the difference is quite confusing to me, aren't these the same things? when people to refer to "2021 budget" isn't this the same thing as "2021 forecast"? appreciate any guidance in advance.
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Hi michaelmick19951995, any of these threads helpful:
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If those topics were completely useless, don't blame me, blame my programmers...
Interesting question.
How I think about it: budgets are used internally by managers, the Board, and owners as a basis of comparison on a monthly, quarterly, or annual basis. Forecasts are usually longer-term and might also be less granular. Forecasts are also sometimes shown to outsiders.
This is my interpretation, but technically a budget is a type of forecast.
Usually the same model - budget holds steady throughout year, and forecasts are done periodically based on YTD performance and new information
This. Forecasts change. Budget is set once for the year at the beginning.
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