What is the difference between a close and a forecast?

The close is the process of finalising the month's actual numbers. The forecast is the process of updating the forward-looking projection based on the latest actuals and intelligence. They are sequential: close first (days 1-3), then forecast (days 4-8).

How should FP&A time be split between reporting and analysis?

The target is 20% reporting, 80% analysis. In practice, many FP&A teams spend 60-80% on reporting and data gathering, leaving little time for insight. Automating the data pipeline and report generation with tools like Grove FP frees up time for high-value analysis.

Who should attend the monthly finance review?

CEO, CFO, and all VPs/department heads. Each department head should present their own BvA and actions. The CFO presents the consolidated view and cash position. Keep the meeting to 60-90 minutes with a clear agenda.

When should annual budget planning start?

Start 8-12 weeks before the financial year. For a January year-end company, that means starting in October. The process typically follows: strategic direction (week 1-2), top-down targets (week 3-4), bottom-up department budgets (week 5-8), consolidation and iteration (week 9-10), board approval (week 11-12).

Example

FP&A Workflow Example

A 150-person mid-market company in Leeds with £11M revenue. The FP&A team of three people runs a disciplined planning cadence covering monthly close, quarterly reforecasts, and annual budgeting. This workflow ensures the business always has a current view of performance and outlook.

Example data

Financial model

Week

Activity

Owner

Output

Day 1-3

Close books, import actuals

Controller

Trial balance

Day 4-6

Variance analysis

FP&A Analyst

BvA report

Day 7-8

Update rolling forecast

FP&A Manager

Updated model

Day 9-10

Management pack

FP&A Manager

Monthly pack

Day 12

Leadership review

CFO

Decisions logged

Day 15

Board pack (if board month)

CFO

Board pack sent

Day 1-3

Automated actuals import from Xero saves 2 days of manual data entry. The FP&A team focused on analysis, not data gathering.

Day 9-10

The management pack is assembled from the same model used for variance analysis and forecasting -- no re-keying of numbers. One source of truth.

Day 15

Board pack is produced every other month (6 times per year). In non-board months, the management pack serves as the executive report.

Formulas

Key formulas

fxMonthly Close: Day 1-3 post month-end

Fast close is critical. Actuals should be available by day 3. This requires automated data feeds from the accounting system and pre-reconciled intercompany balances.

fxVariance Analysis: >£5k or >5% = investigate

Materiality thresholds prevent the team from chasing immaterial variances. Only investigate variances above £5k or 5% -- everything else is noise.

fxQuarterly Cadence: Reforecast in Jan, Apr, Jul, Oct

A full reforecast every quarter updates the forward view. This is more comprehensive than the monthly rolling forecast update and involves department head input.

Analysis

What makes this example good

Clear deadlines and owners for every step in the process

Day-by-day timeline ensures the management pack is out by day 10

Materiality thresholds prevent wasted time on immaterial variances

Quarterly reforecasts balance rigour with resource constraints

The same model is used for close, analysis, forecast, and reporting

Customisation

How to adapt for your business

Adjust the timeline if your close takes longer (e.g., day 1-5 for close)

Add a "flash report" step on day 2-3 for CEO/CFO early visibility

Include department head review meetings in the first week

Add an annual budget timeline (typically September-November for Jan year-end)

Include a quarterly business review (QBR) with deeper strategic analysis

Common variations

--Three-day close process for fast-moving startups
--Weekly flash reporting with monthly detailed packs
--Continuous planning model with real-time forecast updates
--Annual planning calendar showing the full year of FP&A activities

Keep exploring

Related examples

Monthly Management Report Example

A 110-person healthcare technology company in Oxford with £6.2M revenue. The FP&A team produces a monthly management pack by the 10th working day of each month. This February pack covers January performance and is distributed to the CEO, CTO, VP Sales, VP Operations, and department heads.

View example

Budget vs Actual Variance Report Example

A 60-person marketing agency in London with £4.1M revenue. The Head of Finance produces a monthly BvA (Budget vs Actual) report for the leadership team. This March report shows YTD Q1 performance against the annual budget.

View example

Rolling Forecast Example

A 75-person professional services firm in Birmingham with £3.8M revenue. The CFO has moved from static annual budgets to a rolling 12-month forecast that is updated monthly. This view shows the March update with Jan-Mar actuals locked.

View example

FAQ

Frequently asked questions

Best-in-class companies close within 3-5 working days. Average is 7-10 days. If your close takes longer than 10 days, you are likely spending too much time on manual processes that should be automated. Focus on getting flash numbers out by day 3.

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