How does forecasting differ among non-profit organizations, businesses, and government agencies? Which type of institution, such as nonprofit, business, or government, may be more accurate when forecasting? Why? Aside from the institution type, what other contexts may affect forecasting results? Why is understanding forecasting important in program evaluation?
Forecasting for businesses involves conducting an analysis to consider which cash flows from last year are expected to continue to do business (customers under contract, for example), which customers are likely to continue business (those with strong relationships), those who might continue to do business and those that may not. In addition, revenue increase expectations are figured in included those caused by price increases, growth that will be realized from accounts who were picked up during the middle or end of last year (whose revenues will, now, be realized all year), and the potential for the likelihood of closing new deals. Revenue decreases from lost or questionable accounts and an estimate for bad debt are all rolled in to estimate revenues for the coming year. In terms of forecasting expenses, the company knows with some certainty what fixed expenses will be, and must scale operations and variable expense forecasts according to forecasted income numbers. Any expected additional profits can be allocated ...
The non-profit organization, businesses and government agencies are examined for forecasting.