Explain budgeting, allocations, rolling forecast process.

Question

Accepted Answer

Budgeting involves setting financial goals, allocations distribute resources, and rolling forecast process adjusts plans based on new information.

Budgeting is the process of creating a financial plan for a specific period, typically a year, outlining expected revenues and expenses.
Allocations involve distributing resources, such as funds or manpower, to different departments or projects based on the budget.
Rolling forecast process is a continuous planning approach where forecasts are regularly updated based on actual performance and new information.
For example, a company may create an annual budget outlining sales targets and expenses, allocate funds to different departments based on the budget, and then adjust forecasts quarterly based on actual sales performance.

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