2. Unit 3: Financial Forecasting for Business OCR Level 2 Cambridge Technicals in Business

3. Joe Swash Mike Tyson John Barnes Walt Disney Michael Barrymore Abraham Lincoln Kerry Katona George Best Elton John What’s the link? What do the following people have in common? The answer is : They have all filed for bankruptcy!

4. Planning ahead Even profitable companies and organisations can face unexpected circumstances which can threaten their business stability if not managed adequately. It is always difficult to plan for the future: it is by definition unknown! This is particularly true in business where over 60% of all new business start ups will fail in their first year!

5. Why is financial forecasting important? The number one cause for business failure is often stated as being poor cash flow management and financial forecasting. Good cash flow management will help a business be prepared for those unexpected hiccups by knowing in advance where the more difficult periods are.

6. What will you learn? After completing this unit you will: Be able to create a cash-flow forecast Be able to prepare a break even analysis Know about costs, revenue and profit in a business organisation

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