Financial budgeting and forecasting is the process of predicting a company’s anticipated financial performance in future periods. This includes estimating both income and expense streams, as well as projecting cash flow and financial ratios. Before committing resources to specific activities, organizations must understand how their decisions will impact finances down the line. An effective financial budgeting and forecasting system can help identify potential risks and opportunities – allowing businesses to make informed strategic decisions. Budgeting and forecasting are integral components of any successful financial management strategy.