Proformas

The proforma finance statements are estimates (should all projections be accurate) of what the financial statements will look like at the end of the year. These numbers are driven by the entries in the decision areas, and they change as your decisions change. Therefore, the proforma numbers will not be of value until your decisions begin to finalize. The proformas include a balance sheet, income statement, cash flow statement, and a selection of useful financial ratios.

The Proforma predictions can vary widely from year-end results. For example, sales estimates or product prices might be unrealistically high, making the Proforma numbers look great. However, if sales fall short of estimates, the round results will be significantly different from the Proforma numbers.