Financial Forecast Law and Legal Definition

Financial forecast or financial plan refers to an annual projection of income and expenses for a company, division or department. Financial forecasts present an entity's expected financial position, results of operations, and cash flows in future periods. The financial forecast presents the predicted results for the next year. Financial forecasts assume that the entity will continue to function in the manner in which it is currently functioning. For example, if the entity is a retail store chain it is assumed that it will continue to do business in the manner in which it is currently engaged.