Setup Profit & Loss Forecast for Account (QuickBooks)

Setup Profit & Loss Forecast for Account

QuickBooks software is one such accounting software, that apart from tackling financial tasks of the business also helps in the growth of the business by performing certain additional activities like aiding in generating forecast or financial projection reports of the business. These projections or forecasts play important role in garnering imperative viewpoints of investors as the business plan is constructed keeping these predictions in mind. However it is no easy business to make feasible forecasts over the course of the year ensuring a slight waywardness from the course set will still guarantee good returns. An in-depth research, behaviour and a proper outline along with some backing of history can ensure a good forecast report, ensuring user has strong hold on the future working of the business.

In simple terms, forecast / financial projections refer to predicting the revenues garnered and expenses incurred in next financial year on the basis of the history of the business, end users response towards product or service and the need of the product or service in the market. It inculcates huge level of research involving proper hold over the historical digits and data present along with internal working of business accounts.

In essence the employee working on Forecast reports will aim to provide projection for both short and mid-term. Under short term forecasts, predicted report for next one year will be generated, providing month – by – month details of the year. On the other hand, mid-term projection is created for next three years of the business, in which details would be provided on yearly basis.

To generate financial forecast reports, many software offer free online templates that are adequate to prepare at least a rough draft of the projections. Its the same with QuickBooks with additional benefit of allowing user to add graphical representations and charts to provide cleaner and engaging explanation of numerical data. It is much preferred way of preparing reports than just providing with numbers and digits in form of paragraphs which can also lead to missing out on important points.

Imperative reports prepared under this phase are basically three in number – Income Statement (Profit and Loss Statement), Balance Sheet, Cash Flow Statements. Of these one of the main report is of Income statement which basically represents the revenue and profit garnered along the expenses incurred by the business for that particular period (financial year). In case the user is preparing forecasts reports for upcoming year, then the maximum research and predicted decisions come under this report. Main parts of Profit and Loss Statement are:

  1. Revenue: The total amount of cash or credit earned by he business by according end users with required products and services.
  2. Expenses: Under this business owner provides complete details of all the expenses bared by the business including direct ones like employee salary, equipment costs, raw materials etc, along with Administrative and General expenses like accounting and bookkeeping fees, advertising, office rent, telecommunications, insurance etc.
  3. Total Income: Revenue earned with expense incurred deducted from is the total income (without adding income taxes to the reports)
  4. Income Tax incurred over the year.
  5. Net Income: Income Tax deducted from Total Income offers net income amount to the user.

Financial forecast reports gets completed when the user also accounts a proper overview of what is to be expected for the next coming financial year along with in-depth analysis of all the numerical data displayed within the reports. The highlights of the reports doubles up as the summary for the upcoming year for the business providing all the required concise view over the figures presented within the report.

In case user faces any issue in setting up the financial projection for profit and loss statement for next year within the template, a proficient team is on standby handpicked by Intuit itself to provide exemplary services in limited time period. The team consists of QuickBooks technicians who have gained expertise in their profession by going through intensive training and extensive knowledge regarding the software.

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