All 34 The Budgeting Process questions
More in The Budgeting Process
What is a budget? What are the main purposes/objectives of budgeting? What is the budget period? What is top-down (imposed) budgeting? What is bottom-up (participative) budgeting? What is meant by budgetary control? Who is responsible for preparing a budget? What is a functional (departmental) budget? What is the difference between planning and control aspects of budgeting? What is a cost center?
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Budgeting & Forecasting › The Budgeting Process

What is the difference between a budget and a forecast?

Beginner

Answer

A budget is a plan or target the business commits to and controls against; a forecast is an estimate of what is likely to happen given current expectations, updated as conditions change. Budgets set goals and drive accountability; forecasts predict outcomes and inform decisions. A forecast may show the budget will or won't be met.
Real-world example The board holds managers to the annual budget while updating a rolling forecast each quarter to see the likely landing point.

Common follow-ups: Which one is a commitment? | Can a forecast differ from the budget?

Rolling Forecasts Types of Budgets The Budgeting Process
All 34 The Budgeting Process questions