The long-term financial forecast gives top management some sense of the income or profit potential possible with different strategic plans. A budget becomes the primary basis and guide for the firm's financial operations. What long-term investments are made. When specific funds will be needed. How the funds will be generated.
Most companies hold at least monthly financial reviews as a way to ensure financial control.
Such controls provide feedback to help re veal which accounts are varying from the financial plans. Some financial adjustments to the plan may be made. Recognize the financial needs that must be met with available funds. In business, the need for operating funds never seems to cease. Funds must be available to finance specific operational needs.