Annual budgets are no longer enough in today's business world, where things change quickly. Market conditions that change all the time require constant planning and adaptation, which quickly makes methods that are based on the past useless.

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Because of this, the CFO's job has grown, and they now need to be a proactive strategic partner who leads the company forward with foresight. Finance needs to get past the limitations of fixed budgeting and adopt more flexible, dynamic methods made possible by modern tools to effectively meet this strategic goal.

Introducing rolling forecasts

Rolling forecasts are being used more and more by finance teams to meet the need for ongoing planning and gain strategic foresight.

Definition: continuous, updated view beyond a fixed period

A rolling forecast is a dynamic financial projection that is always being updated, usually once every month or three months. This is different from a traditional yearly budget, which is set in stone.

It looks into the future for a set number of periods, like 12, 18, or 24 months. As one period ends, a new one is added, keeping the sky always looking forward.

Benefits: better accuracy, responsiveness, forward visibility

This method uses the most up-to-date performance data and market information, which naturally makes it much more accurate than static budgets. Because it is continuous, it makes the company more responsive, so it can quickly spot trends, spot risks, and take advantage of opportunities.

In the end, rolling forecasts give the CFO and leadership more forward vision, giving them actionable insights that help them make faster, better strategic decisions in an uncertain environment.

Software as the enabler

To use changing forecasts effectively, you need to stop doing things by hand. Software is the most crucial element that enables dynamic financial planning by providing you with the foundational tools and resources necessary.

According to Statista, as of 2022, Orion was the most popular all-in-one financial software program worldwide. At that time, Orion was used by 6.12 percent of the companies. Morningstar Office came in second, with a 6.1% share of the world market.

Types of relevant software

• FP&A (Financial planning & analysis) software: It includes tools for budgeting, forecasting, reporting, and analysis. The full name for this type of software is "FP&A" software.
• EPM (Enterprise performance management) suites: Larger tools that combine planning for both finances and operations are called EPM suites.
• Dedicated forecasting tools: Forecasting tools that are dedicated to advanced methods of forecasting are called specialized apps.

Replacing spreadsheets

Spreadsheets are common, but don't work well with moving forecasts because they are complex and change over time. Software has important benefits, such as:

• Automation: Automating jobs like data entry and doing the same thing over and over again saves time in finance.
• Data integration: It connects straight to different source systems (ERP, CRM, etc.) to make sure that data is correct and up to date.
• Reduced errors: Version control, centralized data, and standard calculations all help reduce the number of math mistakes and mistakes that happen when using spreadsheets.

Enabling collaboration and standardization

Modern tools make the process more unified and effective:

• Modern tools provide a single, secure location where individuals from various departments can input data and collaborate on forecasting.
• Standards, templates, methods, and data definitions ensure that everyone in the company uses the same information and can compare it.

Key benefits of software-driven rolling forecasts (for CFO & team)

Specialized software-powered rolling forecasts offer significant advantages. It changes the way finance works and gives the CFO and their team more power.

The change isn't just about the way things are done; it's also about using technology to make things possible. When finance teams get powerful planning tools, it has a giant effect on both day-to-day activities and their ability to make strategic decisions. It is very helpful to use special software to make rolling plans.

This changes how finance works and gives the CFO and their team more power. The best software for accountants in financial planning and analysis (FP&A) does more than just perform simple calculations; it also provides a strong foundation for making complex predictions.

By automating repetitive tasks, these tools enable you to complete more work in less time. This efficiency gain is felt right away, which makes it not only possible but also practical to change forecasts often.

Increased speed and efficiency

• When you automate data collection and processing, you spend a lot less time doing things by hand.
• It becomes possible and less of a hassle to change forecasts often.

Enhanced accuracy and data reliability

• Directly integrating data from source systems cuts down on mistakes and makes sure that the most up-to-date, accurate data is used.
• Forecasts are more accurate when data models are centralized and processes are uniform.

Improved scenario planning and what-if analysis

• Accounting software lets finance teams quickly model different possible outcomes, such as the best-case scenario, the worst-case scenario, and specific market changes, and figure out how they might affect the business.
• This software enables comprehensive "what-if" research to prepare for various potential future scenarios.

Real-time insights for faster decision-making

• Dashboards and constant changes give leaders up-to-date, useful financial information.
• Based on current projections, it lets you make faster and better strategic and operational choices.

Greater team productivity & focus on analysis

• When finance professionals don't have to do the same data work over and over, they have more time to do more useful research, interpretation, and strategic advice.
• This shift transforms the team from data processors to astute business partners.

Implementation considerations

To make the switch to software-driven moving forecasts work, you need to do more than just pick a tool. Taking these important things into account is necessary for a smooth adoption and getting the most out of the benefits.

• Choosing the right software

It is critical to choose the right program. It needs to be able to handle large amounts of data for dynamic projections, work well with current business and financial systems, and be expandable to handle future growth. Determining the vendor's reliability and how long they will assist you is also a key part of the decision-making process.

• Data integration strategy

It is necessary to have a good data integration plan. This includes finding all the necessary data sources across the company (ERP, CRM, etc.), making sure the quality of the data before it is integrated, and setting up reliable, ideally automated, ways to get data into the forecasting platform. Correct predictions are based on clean, merged data.

• Change management and training for the finance team

Change management is needed to put in place new tools and a new process like rolling forecasts. This includes making sure the finance team understands the strategic goal and benefits, training them thoroughly on the new software and methods, and addressing any concerns or resistance right away to ensure team buy-in and proficiency.

Achieving future-ready finance

To sum up, if you want your finance department to be ready for the future, you need to start using modern tools to make rolling forecasts. This powerful mix of software and rolling forecasts changes finance into a function that is flexible, insightful, and strategic.

It gives the CFO continuous, data-driven forward visibility, which gives them the power of continuous foresight to deal with complexity, make faster, better-informed decisions, and confidently lead the company toward its strategic goals in a world that is always changing.

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