You might often notice that in the world of business, financial modeling and financial forecasting are used reciprocally. But both of them are considered discrete. Financial forecasting is the approach used to predict the state of a business firm in the upcoming future whereas financial modeling is a process that stands for the assessment of the financial performance of a corporation based on these predictions, forecasts, or previously collected data. While forecasts may be displayed on cash flow and income statements as well as balance sheets, financial models are created for utilization or reference within the corporation and may not essentially be shared with any investor. Though financial modeling and forecasting are two independent terms, they are similar to each other in a way that both forecasts and models use the same past information to project a business's earnings.