CFO Advisory

Budget, Forecast and Plan: Three Different Documents

TallyWise Team
By TallyWise Team
November 6, 2026
6 min read
Budget, Forecast and Plan: Three Different Documents

Budget

What you committed to at the start of the period. It is a benchmark, and its value comes from staying fixed. A budget revised every month is not a benchmark; it is a forecast with a misleading name.

Forecast

What you now expect to happen, updated as reality arrives. It should change. A forecast that never moves is not being maintained.

Plan

The set of actions intended to close the gap between forecast and budget. This is the part most often missing. A review that identifies a variance and names no action has not finished.

How to run the review

Compare actual to budget to see commitment performance, and actual to forecast to see forecasting quality. Variances above a threshold get an owner and an action. Anything below it gets noted and ignored, which keeps the meeting focused.

Rolling forecasts

Many businesses move to a rolling twelve or eighteen month forecast while keeping an annual budget. The budget holds people accountable; the rolling forecast keeps decisions current. Both have a job.

TallyWise provides this as part of our fractional CFO services. Book a call to talk through your situation.

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