Assumptions are an important input for financial forecasts. Making them visible and easy to understand is a way of sharing the truth.

If you are in non-finance…

Don’t just fill in the forecast template. Write down your assumptions. Include them in the forecast template. Understand any risks in the assumptions by asking questions like: “What could go wrong?”

If you are in finance…

When reviewing and updating financial forecasts, most of the effort should be in testing assumptions and making sure that they are up to date. This ensures finance and the rest of the business are on the same page.

A forecast without assumptions is just maths. You need more than just maths to share the truth. And make good decisions.

How are you sharing the truth when it comes to financial forecasts?

I’d love to hear your thoughts.

Robert

P.S. Whenever you're ready, there are a couple of ways I can help:

1. Come to your site and run a Financial Literacy workshop. Helping non finance managers understand their numbers so that they can own them. And make good decisions.

2. Mentor your Finance team. Helping finance professionals have greater influence, so that they can advise their stakeholders what to do next. It’s like having a mini-CFO at every table.

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