What is a 'Pro-Forma Forecast'

A pro-forma forecast is a financial forecast based on pro-forma income statements, balance sheet and/or cash flows. Pro-forma forecasts are usually created from pro-forma financials, which are forecasted using basic forecasting procedures. Often, revenues will provide the initial groundwork for the forecast, while expenses and other income statement items will be calculated as a percentage of future sales.

BREAKING DOWN 'Pro-Forma Forecast'

Pro-forma forecasts, similar to any sort of pro-forma report, are not required to abide by GAAP. As a result, they often reflect the best-case scenario, which the firm would like to portray to investors.

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