Flashcards: Financial Planning and Budgeting Masterclass — 18 cards

Financial statements — purpose?

Summarize company's projected financial position.

Forecasted income statement — role?

Estimate future profitability based on projected revenues and expenses.

Balance sheet — function?

Show projected assets, liabilities, and equity at a future date.

Assets and liabilities — forecasting?

Estimate future values based on budgets and plans.

Cash flow budget — purpose?

Project cash inflows and outflows for liquidity management.

Budget de ventes — role?

Forecast expected sales revenue and volume.

Sales budget — key element?

Sales volume, unit price, and payment terms.

Purchase budget — purpose?

Estimate procurement costs aligned with sales forecasts.

Expense budget — function?

Project operational costs for cost control.

VAT budget — role?

Forecast VAT payable or recoverable for cash planning.

Cash flow budget — purpose?

Monitor liquidity by forecasting inflows and outflows.

Working capital — definition?

Current assets minus current liabilities.

Forecasting cash position — goal?

Predict liquidity to avoid shortages or surpluses.

Investment appraisal — purpose?

Evaluate profitability and risks of projects.

Financing structure — role?

Determine debt and equity mix for stability.

Cost of capital — significance?

Required return for investors, used in project valuation.

Leverage effect — what?

Using debt to amplify returns or losses.

Investment horizon — meaning?

Time period over which returns are expected.