The glossary to understand and take action

Financial forecast

The financial forecast translates the project's assumptions into expected results, cash flows and financing needs.

Notion comptable, fiscale ou juridique · Luxembourg Fiduciaries Editorial Team · Reviewed on

Understand the scope

Definition and points to distinguish

It must identify uncertainties and test several scenarios. An expected receipt is not an acquired resource; payment terms must be incorporated.

In your file

What this changes in practice

The forecast translates the project's assumptions into expected financial statements. Profit or loss, cash flow and financing must be distinguished: a profitable sale may be collected late. Tax due dates, repayments, salaries and investments may create a liquidity requirement. A useful forecast states the assumptions, the period covered and the sensitivities; it is then compared with actual results to explain variances and adapt decisions.

A scenario to help you understand

Educational example

A business invoices heavily at start-up, but its customers pay later. The cash flow plan shows a temporary financing requirement that the forecast income statement alone does not reveal.

Fictitious situation, presented to illustrate the concept.

Prepare for what comes next

Points to check

  • Documenter délais de paiement et saisonnalité
  • Séparer résultat et trésorerie
  • Comparer prévisions et réalisations

The practical question

Find out more

Pourquoi préparer plusieurs scénarios financiers ?

Une prévision dépend d’hypothèses incertaines, notamment les ventes et délais de paiement. Comparez un scénario central et une situation moins favorable pour mesurer le financement nécessaire et les décisions possibles. Gardez les mêmes règles de calcul entre scénarios. Le prévisionnel devient ainsi un outil de décision et de suivi, plutôt qu’un tableau figé destiné uniquement à un financeur.

Connecting concepts

Terms to know as well

Continue with the concepts, contacts and procedures related to this topic.

Business planThe business plan presents the project, its market, its organisation and its financial forecasts.Budget varianceDifference between an actual value and the budgeted value for the same scope and period.Working capital requirement (WCR)The working capital requirement (WCR) measures the financing absorbed by the operating cycle, notably inventory and receivables, less operating liabilities.SARL-SThe SARL-S is a simplified variant of the SARL, subject to specific conditions concerning, in particular, the shareholders, the activity and the capital.Wage indexationIndexation adjusts remuneration according to the legal mechanism of the sliding scale and the corresponding effective dates.Break-even pointThe break-even point is the level of activity at which revenue covers the costs included in the calculation model.

Put it into practice

Explore further with our guides

Practical guideBusiness plan in Luxembourg: building verifiable assumptionsPractical guideBank reconciliation: understanding and handling discrepanciesPractical guideThirteen-week cash flow plan: building useful monitoringPractical guideIntra-group financing: documenting loans and interest

Sources and verification

References consulted on 20 September 2026. Official procedures specify the applicable conditions and exceptions.

This guide explains a general process. The applicable rules depend on your situation; it does not constitute personalised advice. Report a correction.

A definition gives you a reference point. To examine your situation, clarify your question with a professional.