Profit and Loss - Forecast

The Profit and Loss statement is one of the most important elements in financial reporting. It reveals many insights about your company. The actual numbers of your P&L can help you to improve your business, and also your P&L forecast is important to guide you in the right direction for growth and profitability. If you want to learn more about the importance of your P&L forecast, check out this article.

Key elements which feed into your Profit and Loss forecast

To get your P&L forecast running you need to know what financial forecasts you have to set up first. In Calqulate, forecasting is mostly automated and is created from four main sources:

  • Staff costs Forecasting
  • Expenditure Forecasting
  • Renewal of current subscriptions
  • Sales Forecasting

All of the above forecasts feed into your SaaS metrics, growth metrics, Profit & Loss and cashflow forecasting, creating a full financial plan to forecast your future financial performance.

Staff cost Forecasting

Staff costs are typically the largest part of your company's expenses and therefore they are essential for your P&L forecast. Staff costs consist of gross salaries and social charges such as pension and insurance expenses. Read more about it in the this article.

Expenditure Forecasting

Staff costs are not the only expenses of an organization. To get your P&L forecast correct, you need to include an expenditure forecast as well. This typically includes costs associated with rent, marketing or office expenses. Check out the article about expenditure forecast to learn more about it.

Renewal of current subscriptions

One of your main sources of income is the revenue of your current customers. Unfortunately, not every customer of your company will stay with you forever. In order to get a realistic forecast, we need to include the churn of customers, as well. This is done by inserting the probability of your customer renewing their subscription. More information about how to edit this can be found in our article about it. 

Sales Forecasting

As sales determine your future revenue, you need to include it in your P&L forecast. The sales forecast feeds data into the P&L revenue forecast. In order to see the data from your sales forecast in the P&L forecast, you need to link your products to your Chart of Accounts. Find our help article for setting up your Sales forecast here.

To link your products to a financial account go to PRODUCTS on the left-hand menu. Choose one of your products and click on it.

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In the section Product details you can check if your product has already been linked to an account. For linking it go to Edit.

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Click the down arrow in the field Financial account and select a financial account.

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Now your Profit and Loss forecast will also forecast the numbers from your sales forecast. Any sales forecasts you add for this particular product will be displayed in the Profit and Loss report in the financial account you chose for the product.

Where to find your Profit and Loss forecast

Your Profit and Loss table displays either actual or forecasted numbers. By default, the table shows actuals, but you can change this with the menu below the heading. Go to the left-hand menu FINANCIAL REPORTING > Profit and Loss and choose Forecast.

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That's it! Now you can see your P&L forecast.


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