What is Budget and Forecast

Budget

Forecast

Budget are the numbers to achieve target
Forecast tell what can happen based on certain events predicted or foreseen
Budget is planned events
Forecast is done to predict events that may or may not happen in future
Budget is formal plan
Forecast are informal plans with in organization
Budget is prepared before forecasting and budget is prepared after reviewing strategic plan of organization
Forecasting of units is done before budget exercise
Budget is used to control the organization, and a reliable finalized forecast
Forecast is anticipation of future sales based on events
Budget preparation is done to plan next financial year
Forecast can be monthly, yearly, quarterly. forecast prediction numbers can vary from time to time
Budget is need to anticipate revenues and expenses for next year
Forecasting is done to predict demand and sales
Done before ending of current financial year
Forecasting is ongoing process, done through the year for existing products or new product launch
Budget is assessment done to allocate resources
Forecasting is planning and projecting for non-linear, unexpected or seasonal anomalies.
Budget guide on how much to spend
Forecast help in understand unforeseen opportunity or problems on the horizon
Mostly budget numbers are decided by Top management in organization and once published, organization stick to budget numbers – these number are locked, no scope of  revisiting numbers
Forecast numbers are flexible, company use forecast to tack every month in comparison to their budget target
Budget include, detailed labor, operating expense, revenue, marketing, capital expenditure and factory planning and done at cost center level for next 12 months or longer
Forecast are comparably less granular or detailed.
Forecasting help companies analyze 1) sales are coming faster or slower, 2) any significant change/ event in industry or market place, 3) are expenses are higher or lower
Mainly expected revenue and expense is projected
Forecasting help company understand are they meeting Budget target

In most cases you will find budget numbers, forecast numbers and actual numbers from market will not match.

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Tell your experience how budget and forecast is defined in your organization.