This is a Working Example of our Forecasts
Registered users can produce their own business forecasts in minutes; exactly as is shown here.

Report name: Sample Forecast

How the Balance Sheet Forecast is Calculated

Assets and liabilities in this balance sheet define a company’s forecast financial condition. Liquidity, gearing and solvency are all derived from it.

forecast for year beginning the 1st.May 2017May 2018May 2019
Fixed Assets56,62454,08177,791
Current Assets217,675261,733506,750
Total Assets274,298315,813584,540
    
Current Liabilities154,652125,407181,409
Long Term Liabilities13,8784,09511,648
Total Liabilities168,530129,502193,057
    

Net Current Assets (Working Capital)

63,022136,326325,341
    
Net Assets105,768186,311391,483
    
Capital5,0005,0005,000
    

Retained Profits Bfwd

20,000100,768181,311

add: Profit / Loss after Tax

80,76880,543205,172

less: Dividend

000

Retained Profits C/Fwd

100,768181,311386,483
    

Capital and Reserves (Equity)

105,768186,311391,483

How to Read a Balance Sheet Forecast

A balance sheet forecasts a company’s financial condition. Net assets in deficit forecasts insolvency, net current assets in deficit, a liquidity crisis

Under no circumstances should your business plan's balance sheet forecast include a deficit for either of these.

What Does a Balance Sheet Balance Against

Equity, also known as shareholders’ funds or reserves is owed by the company to its shareholders. Hence it is a liability.. 

Equity includes paid up share capital, tax paid profits that have been re-invested  and if applicable, share premium account. That all balances against the company's net assets.

How to Create this Balance Sheet Forecast

Figurewizard automatically produces this balance sheet forecast simply using your forecast sales, margins, overheads, investment and a few simple cash ratios.

UK corporation tax .and VAT are automatically automatically calculated and applied to the forecasts and the calculator / planners by the system.

Working Capital Forecast

Net current assets represent working capital which measures balance sheet liquidity.

Current assets refer explicitly to core trading assets such as cash, accounts receivable and stock that is reliably expected to be turned into cash within a year minus all debt scheduled to be paid, also within a year.

A positive liquidity forecast tells you and others, for example the bank how well you expect your business plan to generate cashflow from its core trading operations.

Planning Balance Sheet Liquidity -  Wages and Fixed Overheads

Figurewizard's What-If Calculator and Planner gives you the opportunity to update / change forecasts in real time.

Here it is used to improve working capital and cash by reducing forecast wages and fixed overheads - Each by increments of 5%

Year 1 less Fixed O/Heads & Wages Pre-Tax Profit Equity Working Capital .Borrowings plus / minus Bank Year End
0% 430,000 94,381 105,052 59,993 53,854 -35,439
5% 408,500 116,779 123,911 81,165 33,488 -13,261
10% 387,000 138,712 141,677 98,931 9,962 8,452

Fixed Assets Forecast

Cost less depreciation describes the net book value of fixed assets in the balance sheet.

Net book value is the residual value of fixed assets' forecast working life in the business, not their estimated fair market values.

That is an important distinction. Depreciated net book values for fixed assets are almost always significantly lower than those that could be obtained if put up for sale. In the event of a forced sale their prices would be lower still.

Further, fixed assets play no part in defining liquidity other than depleting it upon their acquisition; regardless of asset financing.

 Planning Balance Sheet Liquidity - Fixed assets

Working capital and cash flow forecasts are affected by investment in new fixed assets. The costs plus any new debt associated with financing always reduces balance sheet liquidity.

For example, in this sample forecast, £30,000 of new main pool assets (e.g. plant and machinery, fixtures, equipment, trucks and vans) and £25,000 for company cars have been entered, a total of £55,000. Seventy percent of that is financed over 24 months.

The table below shows how that £55,000 affects working capital and cash flow, followed by what happens to these if first the £25,000 for new cars is removed followed by the £30,000 of new main pool assets.

Fixed Asset Acquisitions Fixed Overheads Interest Charges Equity Working Capital   Increase / Decrease Borrowings Bank Year End
55,000 430,000 5,062 105,052 59,993 53,854 -35,439
30,000 408,500 3,104 127,097 100,956 5,616 -691
0 387,000 1,488 143,371 135,789 -48,780 69,719

How Much Does Figurewizard Cost

Up to a hundred complete sets of forecasts can be saved. Subscribing to Figurewizard is just £30 a year. There are no extra charges.

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