A Quick & Dirty Method for Estimating Growth and Price Changes for Forecasting Financial Statements (in Spanish)

26 Pages Posted: 31 Mar 2009 Last revised: 1 Jun 2009

See all articles by Ignacio Velez-Pareja

Ignacio Velez-Pareja

Grupo Consultor CAV Capital Advisory & Valuation

Date Written: April 11, 2009

Abstract

This is a teaching material for a course on financial analysis and financial statement forecasting.

In this teaching note we show a dirty and quick approach to extract relevant information from historical financial data for forecasting financial statements. We make extensive use of the Fisher Relationship and find three components that affect the growth of sales in dollars. These components are change in quantities, change in real prices and inflation rate. Once we estimate the first two inputs we incorporate in the analysis an inflation forecast. The combination of the three components allows us to estimate the growth in sales and construct the forecast.

Keywords: Accounting, financial management, financial statements, balance sheet, Income Statement, financial ratios, forecasting, sales growth, growth in units, real growth, real increase in price, Fisher Equation

JEL Classification: M41, G29

Suggested Citation

Velez-Pareja, Ignacio, A Quick & Dirty Method for Estimating Growth and Price Changes for Forecasting Financial Statements (in Spanish) (April 11, 2009). Available at SSRN: https://ssrn.com/abstract=1370127 or http://dx.doi.org/10.2139/ssrn.1370127

Ignacio Velez-Pareja (Contact Author)

Grupo Consultor CAV Capital Advisory & Valuation ( email )

Ave Miramar # 18-93 Apt 6A
Cartagena
Colombia
+573112333074 (Phone)

HOME PAGE: http://cashflow88.com/decisiones/decisiones.html

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