Budgeting & Forecasting › The Master Budget
What is a pro forma financial statement in budgeting?
BeginnerAnswer
A pro forma statement is a projected/forecast financial statement—the budgeted income statement, balance sheet, or cash flow—built from the budget rather than actual historical results. 'Pro forma' means 'as a matter of form', i.e., a formatted projection of expected results.
Real-world example The budget package includes pro forma income statement and balance sheet showing the expected year-end position.