Forecast Profit and Loss Statement — Complete User Guide — Two Accounts Web

Comprehensive guide for generating, analysing, and understanding the Forecast Profit and Loss Statement report — projecting future income and expenses using recurring forecast entries with growth rates, across multiple comparison periods

Table of Contents

1. What Is the Forecast Profit and Loss Statement Report?
   • Purpose and Structure
   • How It Differs from Other P&L Reports
2. Accessing the Report
3. The Forecast Workflow
   • Creating a Forecast Entry
   • Glossary of Forecast Fields
   • Repeat Frequencies
   • Growth Rate
   • How Forecast Transactions Are Generated
4. Field-by-Field Guide
   • Report Header Fields
   • Report Columns (Periods)
   • Toggles
5. Settings Configuration
   • Forecasts Settings
6. Creating a Forecast Profit and Loss Statement Report
7. How the Report Is Calculated
   • Forecast Transaction Generation
   • Period Aggregation
   • Chart of Accounts Hierarchy
   • Sign Convention
   • Zero Balance Exclusion
8. Copy to Budget
9. Drill-Down Capabilities
10. Sample Data and Report Output
    • Sample Setup
    • Forecast Entries
    • Generated Transactions
    • Report Output
    • Verification of Calculation
11. Common Issues and Solutions
12. Accounting Regulation Compliance

1. What Is the Forecast Profit and Loss Statement Report?

1.1 Purpose and Structure

The Forecast Profit and Loss Statement report projects future income and expenses based on forecast entries that you define in Settings → Forecasts. These forecast entries can be one-time or recurring transactions assigned to specific Profit and Loss statement accounts. The report aggregates these forecast transactions into period columns, organised by the Profit and Loss Chart of Accounts hierarchy.

Each row in the report represents a P&L account or group, following the same hierarchy as the standard Profit and Loss Statement. Each period column shows the total forecast amount for that account during that date range. Group subtotals and a grand total are automatically calculated.

This report is essential for:

• Budgeting and planning — projecting future revenue and expenses
• Cash flow forecasting — estimating when income and expenses will occur
• Scenario analysis — comparing different forecast scenarios across periods
• Budget vs actual analysis — forecast data can be copied to a Profit and Loss Statement Actual vs Budget report

1.2 How It Differs from Other P&L Reports

2. Accessing the Report

The Forecast Profit and Loss Statement report becomes available after at least one forecast entry has been created in Settings → Forecasts. Once created, the report appears under:

• Reports → Forecasts → Forecast Profit and Loss Statement

No additional setup in Customize Menu is required — the Forecasts settings page and the Forecast P&L report are both enabled by default. The Forecasts sub-menu under Reports only appears once forecast entries exist.

3. The Forecast Workflow

Before generating the report, forecast entries must be created. Each forecast entry defines anticipated income or expenses that repeat at a specified frequency, optionally with growth.

3.1 Creating a Forecast Entry

Location: Settings → Forecasts → New Forecast

A forecast entry consists of:

• A start date when the forecast begins
• A repeat frequency (daily, weekly, monthly, yearly, etc.)
• An optional growth rate (percentage increase per occurrence)
• One or more line items, each with a P&L account and amount

3.2 Glossary of Forecast Fields

Forecast Line Fields

Sign convention for forecast amounts:

• Income accounts (normal credit balance): Enter positive amounts. The system stores them as negative during transaction generation (since income reduces the P&L balance), then the report flips them back to positive for display.
• Expense accounts (normal debit balance): Enter positive amounts. The system stores them as negative, and the report flips them back to positive for expense display.

3.3 Repeat Frequencies

3.4 Growth Rate

The growth rate applies a compound percentage increase to each successive occurrence. The growth applies to the base amount of the forecast entry, not per line item.

Growth calculation formula:

Occurrence 0 (start date): Amount = Base Amount (as entered)
Occurrence 1: Amount = Base Amount × (1 + Growth / 100)
Occurrence 2: Amount = Base Amount × (1 + Growth / 100)²
Occurrence N: Amount = Base Amount × (1 + Growth / 100)ᴺ

Each occurrence amount is rounded to the base currency's decimal places before being stored.

Example: A forecast of 10,000 with 10% growth and monthly repeat:

January:   10,000
February:  11,000  (10,000 × 1.10)
March:     12,100  (10,000 × 1.10²)
April:     13,310  (10,000 × 1.10³)

3.5 How Forecast Transactions Are Generated

When the report is generated, the system reads all active (non-inactive) Forecast entries and expands them into individual Forecast Transactions within the report's date range (from the earliest period's From Date to the latest period's To Date).

1. Start at the forecast's Date
2. While the current date is within the overall report range (min FromDate to max ToDate):
   1. For each Line in the forecast, create a Forecast Transaction with:
      • Date = current occurrence date
      • Account = the line's account
      • Amount = line's base amount × growth factor (for this occurrence index), multiplied by −1
      • Description = the forecast's description
   2. Skip dates before the report's FromDate (no transactions generated)
   3. Stop when the date exceeds the report's ToDate
3. Advance to the next occurrence date per the repeat frequency

4. Field-by-Field Guide

4.1 Report Header Fields

Location: Reports → Forecast Profit and Loss Statement → New Report

4.2 Report Columns (Periods)

Each report can contain one or more period columns for comparative analysis (e.g. Q1 vs Q2). Each period shows the total forecast amount for each account during that period.

Important: The minimum From Date and maximum To Date across ALL periods defines the overall date range for generating forecast transactions. Forecast occurrences outside this range are not generated, even if they would fall within an individual period.

4.3 Toggles

5. Settings Configuration

5.1 Forecasts Settings

Location: Settings → Forecasts

The Forecasts settings page lists all forecast entries. From here you can create, edit, and manage forecast entries that feed into the report. Each forecast entry can be marked as Inactive to temporarily exclude it from reports without deleting it.

No additional configuration is needed — the Forecast P&L Statement works with the P&L Chart of Accounts as it exists. Any P&L account can be used in forecast lines.

6. Creating a Forecast Profit and Loss Statement Report

1. Ensure forecast entries exist in Settings → Forecasts (create them first if needed)
2. Go to Reports → Forecast Profit and Loss Statement
3. Click New Report
4. Optionally enter a Title
5. Optionally enter a Description
6. Toggle Account Codes on/off as desired
7. Toggle Exclude Zero Balances on/off as desired
8. Add Periods:
   • Click Add to add a period
   • Enter the From Date and To Date
   • Optionally enter a custom Column Name
   • Add additional periods for comparative analysis
9. Optionally enter a Footer
10. Click Save
11. The report generates showing the full P&L hierarchy with forecast amounts per period

7. How the Report Is Calculated

7.1 Forecast Transaction Generation

Before any period amounts are calculated, the system determines the overall date range from the earliest period's From Date to the latest period's To Date. It then reads every active (non-inactive) Forecast entry and expands each one into individual forecast transactions within that range.

Starting from the forecast's Date, the system steps forward by the Repeat frequency (daily, weekly, monthly, etc.) and generates one transaction per Line per occurrence date. Occurrences before the overall range are skipped; the expansion stops when the date exceeds the overall range. Each transaction records the account, the occurrence date, and the line amount adjusted by the growth factor (compound growth applied per occurrence). The description is taken from the Forecast entry's header, not from the individual line.

7.2 Period Aggregation

Once all forecast transactions are generated, the system groups them by account and by period. For each period column defined in the report, the system calculates the total amount for each account by summing all forecast transactions whose date falls within that period's From Date and To Date and whose account matches. The result is a per-period, per-account balance that carries the same sign convention as the underlying forecast transaction (negative for amounts stored in the GL with a credit normal balance).

7.3 Chart of Accounts Hierarchy

The report follows the same Profit and Loss Statement structure as the standard P&L report. The hierarchy includes:

• Income groups (revenue accounts with subtotals)
• Cost of Sales groups (direct costs deducted from revenue)
• Expense groups (operating expenses marked with IsLess flag for subtraction)
• Other Income and Expenses
• Net Profit / Loss (total row at the bottom)

Group subtotals are calculated by summing all child accounts within each group, respecting the IsLess flag (expense groups are subtracted).

7.4 Sign Convention

The forecast system and the report handle signs in three stages:

The reason for the double flip (× −1 at generation, × −1 again at display) is that the underlying transaction system uses a GL balance convention where positive amounts represent debits. Income accounts naturally have credit balances (negative in this system), so the first flip converts the user-friendly positive entry to the system's internal representation, and the second flip converts it back for the human-readable report.

7.5 Zero Balance Exclusion

When Exclude Zero Balances is enabled, the system checks each account row: if all cell values are zero across ALL periods, the row is hidden. Additionally, inactive accounts with all-zero balances are also excluded. This check happens at the individual account level, not at the group level — groups with all-zero children are still shown if they have the subtotal flag.

8. Copy to Budget

The Forecast Profit and Loss Statement report includes a built-in Copy to Budget button. This button appears in the report view and allows you to copy the forecast amounts from the first period column into a new Profit and Loss Statement Actual vs Budget report.

How it works:

1. The system extracts all rows from the report where the first period's cell value is non-zero
2. Each account and its first-period amount becomes a Budget Item in a new P&L Actual vs Budget report
3. The new budget report is pre-configured with:
   • From Date = the first period's From Date
   • To Date = the first period's To Date
   • Exclude Zero Balances = same setting as the forecast report
   • Budget items = the forecast amounts

This allows you to create a budget from your forecast, then later compare actual results against it using the Actual vs Budget report.

9. Drill-Down Capabilities

Each amount in any period column is clickable. Clicking any cell opens a Forecast Transactions viewer showing the individual forecast transactions that make up that amount.

The sign of the drill-down amounts may be flipped relative to the report display (the Reverse Sign parameter controls whether the amount sign is inverted in the drill-down view).

10. Sample Data and Report Output

10.1 Sample Setup

A trading company creates forecast entries for Q1 2026 (January to March). The base currency is BDT.

10.2 Forecast Entries

Forecast Entry 1: Monthly Sales Revenue

Forecast Entry 2: Monthly Rent

Forecast Entry 3: Quarterly Commission

Forecast Entry 4: Annual Insurance Premium

Forecast Entry 5: One-time Consulting Income

Forecast Entry 6: Monthly Department Expenses

Line Items:

Five line items under a single forecast entry.

10.2.1 Creating a Multi-Line Forecast Entry in Settings

To create Forecast Entry 6 (or any forecast with multiple accounts), go to Settings → Forecasts → New Forecast and fill in the form as follows:

┌──────────────────────────────────────────────────────────────┐
│  New Forecast                                                │
│                                                              │
│  Header Fields:                                              │
│    Date:         [1-Jan-2026                ]                │
│    Description:  [Monthly department expenses]                │
│    Repeat:       [Every Month               ▼]                │
│    Growth:       [0%                        ]                │
│                                                              │
│  Lines — click [+ Add Line] to add each row:                 │
│  ┌────┬──────────────────────────────┬──────────────┐        │
│  │ #  │ Account                      │ Amount       │        │
│  ├────┼──────────────────────────────┼──────────────┤        │
│  │ 1  │ Rent Expense              ▼  │ 50,000       │        │
│  │ 2  │ Utilities Expense         ▼  │ 12,000       │        │
│  │ 3  │ Internet & Telephone Exp. ▼ │ 3,500        │        │
│  │ 4  │ Office Supplies Expense   ▼  │ 5,000        │        │
│  │ 5  │ Cleaning & Maintenance Exp ▼ │ 7,500        │        │
│  └────┴──────────────────────────────┴──────────────┘        │
│                                                              │
│  [+ Add Line]                                                │
│                                                              │
│  [Save]  [Cancel]                                            │
└──────────────────────────────────────────────────────────────┘

Key points when creating:

• The Date is set once at the header level — it applies to all five line items
• Each line selects a different Account from the P&L Chart of Accounts
• Each line has its own Amount — these do not need to be equal
• The Repeat and Growth settings apply to every line equally
• This single entry generates 5 forecast transactions per occurrence (15 for Q1)

10.3 Generated Transactions

The system generates the following forecast transactions within the Q1 2026 range (1-Jan-2026 to 31-Mar-2026):

Growth calculation for Sales Revenue:

January (occurrence 0):  500,000 × (1 + 0%)  = 500,000
February (occurrence 1): 500,000 × (1 + 5%)  = 525,000
March (occurrence 2):    500,000 × (1 + 5%)² = 551,250

10.4 Report Output

The report has three periods: January, February, and March 2026.

Forecast Profit and Loss Statement
For the period: 1-Jan-2026 to 31-Mar-2026

                                  Jan-2026        Feb-2026        Mar-2026
━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
 INCOME
 Sales Revenue                      500,000         525,000         551,250
 Consulting Income                        0          75,000               0
 ─────────────────────────────────────────────────────────────────────────
 Total Income                       500,000         600,000         551,250

 COST OF SALES
 (none)                                   0               0               0
 ─────────────────────────────────────────────────────────────────────────
 GROSS PROFIT                       500,000         600,000         551,250

 EXPENSES
 Rent Expense                       100,000         100,000         100,000
 Utilities Expense                   12,000          12,000          12,000
 Internet & Telephone Expense         3,500           3,500           3,500
 Office Supplies Expense              5,000           5,000           5,000
 Cleaning & Maintenance Expense       7,500           7,500           7,500
 Commission Expense                  25,000               0               0
 Insurance Expense                  120,000               0               0
 ─────────────────────────────────────────────────────────────────────────
 Total Expenses                     273,000         128,000         128,000

 OTHER INCOME / EXPENSES
 (none)                                   0               0               0
 ─────────────────────────────────────────────────────────────────────────
 NET PROFIT                         227,000         472,000         423,250

10.5 Verification of Calculation

FORECAST P&L VERIFICATION:

Sales Revenue:
  Jan: 500,000 ✓  (1 occurrence)
  Feb: 525,000 ✓  (1 occurrence with 5% growth)
  Mar: 551,250 ✓  (1 occurrence with 10.25% compound growth)
  Total: 500,000 + 525,000 + 551,250 = 1,576,250 ✓

Consulting Income:
  Jan:        0 ✓  (no occurrence)
  Feb:   75,000 ✓  (one-time on 10-Feb)
  Mar:        0 ✓  (no occurrence)

Rent Expense:
  Jan:   50,000 (Entry 2) + 50,000 (Entry 6) = 100,000 ✓   (2 occurrences)
  Feb:   50,000 (Entry 2) + 50,000 (Entry 6) = 100,000 ✓   (2 occurrences)
  Mar:   50,000 (Entry 2) + 50,000 (Entry 6) = 100,000 ✓   (2 occurrences)
  Total: 300,000 ✓

Utilities Expense:
  Jan:   12,000 ✓  (Entry 6, Line 2)
  Feb:   12,000 ✓
  Mar:   12,000 ✓
  Total: 36,000 ✓

Internet & Telephone Expense:
  Jan:    3,500 ✓  (Entry 6, Line 3)
  Feb:    3,500 ✓
  Mar:    3,500 ✓
  Total: 10,500 ✓

Office Supplies Expense:
  Jan:    5,000 ✓  (Entry 6, Line 4)
  Feb:    5,000 ✓
  Mar:    5,000 ✓
  Total: 15,000 ✓

Cleaning & Maintenance Expense:
  Jan:    7,500 ✓  (Entry 6, Line 5)
  Feb:    7,500 ✓
  Mar:    7,500 ✓
  Total: 22,500 ✓

Commission Expense:
  Jan:   25,000 ✓  (quarterly on 15-Jan)
  Feb:        0 ✓  (next quarterly is April)
  Mar:        0 ✓

Insurance Expense:
  Jan:  120,000 ✓  (annual on 1-Jan)
  Feb:        0 ✓
  Mar:        0 ✓

Multi-Line Entry Verification (Entry 6 — 5 lines under one header date):
  Total per month: 50,000 + 12,000 + 3,500 + 5,000 + 7,500 = 78,000 ✓
  Total Q1: 78,000 × 3 = 234,000 ✓
  15 transactions generated (5 lines × 3 months) ✓
  Same Description "Monthly department expenses" on all 15 ✓

NET PROFIT Verification:
  Jan: 500,000 − 273,000 = 227,000 ✓
  Feb: 600,000 − 128,000 = 472,000 ✓
  Mar: 551,250 − 128,000 = 423,250 ✓

  Total: 227,000 + 472,000 + 423,250 = 1,122,250 ✓

Growth Rate Verification (Sales Revenue):
  Base amount: 500,000
  Growth rate: 5% per month

  Occurrence 0 (Jan): 500,000 × (1 + 0.00) = 500,000 ✓
  Occurrence 1 (Feb): 500,000 × (1 + 0.05) = 525,000 ✓
  Occurrence 2 (Mar): 500,000 × (1 + 0.05)² = 500,000 × 1.1025 = 551,250 ✓

11. Common Issues and Solutions

11.1 Report Shows No Data

Cause: No forecast entries exist, or all entries are marked as Inactive, or the report's date range does not overlap with any forecast occurrence dates.

Solution: Verify that forecast entries exist in Settings → Forecasts and are not marked Inactive. Ensure the report's From Date and To Date overlap with at least one forecast occurrence.

11.2 Forecast Amounts Look Incorrect

Cause: The sign convention for forecast entry amounts may be confusing. All amounts are entered as positive values, but the system internally stores them as negative. The report flips them back to positive. Growth rates compound multiplicatively, which may produce unexpected amounts if a large growth rate is applied over many occurrences.

Solution: Review the growth rate and the number of occurrences. Use the drill-down to verify individual forecast transactions. The amount you enter is the base amount for the first occurrence; subsequent occurrences are adjusted by the growth rate.

11.3 Growth Rate Not Applying

Cause: The Growth field is only visible and effective when Repeat is set to a value other than Never. With Repeat = Never, growth has no effect.

Solution: If you need growth, set the Repeat to a recurring frequency.

11.4 Forecast Not Appearing in Report

Cause: The forecast entry may be marked Inactive, or its date range may fall entirely outside the report's date range.

Solution: Check the Inactive flag on the forecast entry. Verify that the forecast's occurrences (start date + repeat) fall within the report's min FromDate to max ToDate range.

11.5 Copy to Budget Not Working

Cause: The Copy to Budget button only copies the first period's data. If the first period has no non-zero amounts, the budget will be empty.

Solution: Ensure the first period has forecast data. The Copy to Budget button creates a new P&L Actual vs Budget report with the forecast amounts as budget items.

11.6 Zero Balance Accounts Still Showing

Cause: The Exclude Zero Balances option only hides individual account rows with all-zero amounts. Subtotals and group headers are still displayed even if all children are zero.

Solution: This is by design. The P&L structure is preserved even when Exclude Zero Balances is enabled, showing empty groups and subtotals for completeness.

11.7 Forecast Profit and Loss Statement Not in Menu

Cause: The report or the Forecasts settings page may not be enabled in Customize Menu.

Solution: Go to Settings → Customize Menu and ensure both Forecasts (under Settings) and Forecast Profit and Loss Statement (under Reports) are checked.

12. Accounting Regulation Compliance

12.1 IAS 1 — Presentation of Financial Statements

12.2 IFRS 15 — Revenue from Contracts with Customers

12.3 Management Approach (IFRS 8)

12.4 DR = CR Verification

Forecast Transaction Generation Verification:

Forecast entries are NOT GL transactions — they are projections.
No DR = CR constraint applies to forecast data.

However, the amount transformation chain is verified:

Entry: Sales Revenue = +500,000 (user enters positive)
Generation: × −1 → −500,000 (internal stored amount)
Display: Report sums and × −1 → +500,000 (shown in report)

Entry: Rent Expense = +50,000 (user enters positive)
Generation: × −1 → −50,000 (internal)
Display: × −1 → +50,000 (shown in report)

Total Income − Total Expenses = Net Profit:
  Jan: 500,000 − 273,000 = 227,000 ✓
  Feb: 600,000 − 128,000 = 472,000 ✓
  Mar: 551,250 − 128,000 = 423,250 ✓

Note: The Forecast P&L is a projection report. Unlike actual financial 
statements, there is no double-entry constraint. The amounts represent 
expected future cash flows or accruals, not posted GL transactions.

12.5 Forecast vs Actual Reconciliation

The Copy to Budget feature bridges the forecast to actual results:

  Forecast P&L (projection)
      ↓ Copy to Budget button
  P&L Actual vs Budget (budget column = forecast data)
      ↓ Add actual period
  Compare: Actual vs Budget variance

This supports IAS 34 (Interim Financial Reporting) §20:
"An explanation of the nature and amount of items affecting
assets, liabilities, equity, net income, or cash flows that are
unusual because of their nature, size, or incidence."

13. Technical Specifications

13.1 Report Properties

End of Forecast Profit and Loss Statement Guide