Company Performance Forecasting

One of the biggest roles of financial models is to indicate the future outcomes of an entity's financial activity. A set up of a model is done when predicting different revenues, expenses, profits, cash flows, during a fixed span say monthly, quarter, or on year basis.
These projections allow the organizations to be better prepared for future financial conditions, have informed assumptions about future risk factors, and thus better manage their resources. For example, an organization may wish to project future revenues based on historical data and trends within a given market considering macroeconomic circumstances, competition in the marketplace and changes in rules or regulations. Based upon these accurate projections, the organizations can make strategic expansion, cost-reduction, investment, and price as well.