The idea of approximation
Projections vs. Forecasting 본문
1- First differnce is that Forecasting refers to the reports which are made on factual assumptions, and are most likely to occure. Whereas projections are based on somewhat loose assumptions and these are the figures what management want to sea. So these are mostly, wanted reports rather than factual reports.
2- Second difference is that forecasts are mostly intended for outside stakeholders of the company, like general public or shareholders, or government agencies, whereas projections are inhouse reports of the company.
3- Third difference is that forecasts are made upon refined assumptions of future, whereas projections are based on past figures, mostly we can take figures of past and raise them with certain percentage to arrive at the final projected figures.
4- Fourth difference is that forecasts as i mentioned above are generally intended for outside stakeholders so the they are an indication of the future some aspects are controllable by the company and are beyond control. Unlike projectios which are made for specific purpose inside the company and so management may include its "out to be" situations. Therefore projections are more prune to have management bias. For example managment may make a projection of sales more than what is attainable and insist sales department to achive it.
