Pro-Forma Forecast


DEFINITION of 'Pro-Forma Forecast'

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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  1. What is the difference between financial forecasting and financial modelling?

    The difference between financial forecasting and financial modeling is that the former is the process in which a company ... Read Full Answer >>
  2. What is cash or pro forma income on an income statement?

    Pro-forma income statements are adjusted income statements of a company that may more accurately reflect a company's financial ... Read Full Answer >>
  3. What are pro forma earnings?

    Great question, but it is not easily answered, because pro forma earnings figures are inherently different for different ... Read Full Answer >>
  4. Can working capital be too high?

    A company's working capital ratio can be too high in the sense that an excessively high ratio is generally considered an ... Read Full Answer >>
  5. Does working capital include inventory?

    A company's working capital includes inventory, and increases in inventory make working capital increase. Working capital ... Read Full Answer >>
  6. Does working capital include salaries?

    A company accrues unpaid salaries on its balance sheet as part of accounts payable, which is a current liability account, ... Read Full Answer >>

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