Short note on Financial Plan

Any Plan is a projected course of action for the future. A plan that involves the estimation of the requirement of the funds in future and decides how these funds are to be utilized at the future time is known as financial planning

Steps in financial planning

Development of projected financial statements
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Determination of funds

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Forecast of availability of funds for the specific period of time
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Establishment and maintenance of a system that controls governing and allocation use of funds within the firm
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 Development of procedures for adjusting the financial plan
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Establishment of performance based management compensation system 

Uses in financial planning

1.It provides a vivid (clear) picture of inflow and outflow of money, sources of funds and uses of funds
2. Determines firm's goals, policies and procedures