A rolling forecast is an outlook that is updated with new evidence and extended as time passes, so it continues to look ahead over a defined horizon. It explains where the business may be heading under stated assumptions.

A forecast and a budget do different jobs

The adopted annual budget records the plan against which results are compared. The forecast updates what you now expect. Preserve the budget when the outlook changes so variance analysis remains meaningful.

A forecast horizon can be monthly, annual or both. “Rolling” describes the updating and extension practice; it does not universally mean three years or five years. A forecast that keeps the same end date becomes shorter as months pass unless the horizon is extended.

iBD uses the ongoing three-statement model for current reporting and its forward view for the longer ownership plan. Dated columns alone do not establish that a model rolls forward correctly.

Keep actuals, assumptions and scenarios visible

Use closed, reviewed actuals through an identified date. Label the remaining periods as projections. Update the assumptions affected by new evidence, including customer demand, margins, people, working balances, investment, financing and distributions.

A base case is the chosen reference. Upside and downside cases test plausible alternatives; they are not guaranteed outcomes or automatically calculated probabilities. A decision-specific case can show the cost and timing of a hire, acquisition or ownership transition.

Save each scenario’s assumptions and outputs without overwriting the adopted budget. Check the workbook’s supported inputs and scenario controls. A new year label alone does not update source periods, opening balances, formulas or transfer ranges.

Use the forecast in the review rhythm

Monthly reviews bring current results and important changes into the outlook. Quarterly reviews test the longer path, value gap and proposed capital decisions. The annual reset develops and adopts the next annual plan and reviews the forward horizon.

Keep the company’s active workbooks and financial project under The Numbers / Financial Model. Publish the dated summary to the Playbook’s Five-Year Forecast section. The Rhythm records what was decided using that version.

Put the idea to work

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