FP&A
| FP&A tasks and activities |
Financial Planning and Analysis (FP&A), in accounting and business, refers to the various integrated planning, analysis and modeling activities aimed at supporting financial decisioning and management in the wider organization. [1][2] [3] [4] [5] See Financial analyst § Financial planning and analysis, and aside articles, for outline and further detail. In larger companies, "FP&A" will run as a dedicated area or team, under an "FP&A Manager" reporting to the CFO. [6]
FP&A is distinct from financial management and (management) accounting in that it is oriented, additionally, towards business performance management, and, further, encompasses both qualitative and quantitative analysis. This positioning allows management - in partnership with FP&A - to preemptively address issues relating, e.g., to customers and operations, as well as the more traditional business-finance problems. Relatedly, although Budgeting and Forecasting are typically done at specific times in the year - and correspondingly cover specific time periods - FP&A, by contrast, has a wider brief re both horizon and content. "FP&A Analysts" thus play an important role in every (major) decision by the company - ranging in scope from changes in headcount to mergers and acquisitions. [1]
Over the years, FP&A's role has evolved, facilitated by technological advances. [4] During its early years, 1960s to 1980s, FP&A focused on more traditional forecasting and financial analysis; relying on spreadsheets, mainly Excel, but in earlier years, Lotus 1-2-3 (and VisiCalc). From the 1980s to the early 2000s, the scope shifted to risk, scenario and sensitivity analysis; utilizing business intelligence and financial modeling software, such as Cognos and BusinessObjects. From 2000s to present, the emphasis is increasingly on predictive analytics; tools include cloud-based platforms and analytics packages, i.e. Amazon Web Services and Microsoft Azure, and SAS, KNIME, [7] R, and Python; [8] specialized software is also available commercially. [9]
See also
[edit]- FP&A Professional (FPAC)
- Corporate finance analyst
- Strategic financial management
- Chief financial officer § Role
- Financial management § Role
- Management accounting § Role within a corporation
References
[edit]- ^ a b "What is Financial Planning and Analysis (FP&A)?". SAP. Retrieved 2024-11-17.
- ^ Datarails (2024-04-11). "What is FP&A? Overview, History, Responsibilities, and More". Datarails. Retrieved 2024-11-21.
- ^ "Evolution of financial planning and analysis (FP&A)". Evolution of financial planning and analysis (FP&A) | Workiva. Retrieved 2024-11-17.
- ^ a b "The Evolution of FP&A". www.linkedin.com. Retrieved 2024-11-17.
- ^ DeLoach, Jim. "FP&A—A Double-Duty Mandate For The CFO Necessitates Mature Capabilities". Forbes. Retrieved 2024-11-17.
- ^ FP&A Team, Structure, Roles, and Responsibilities, mosaic.tech
- ^ How KNIME Helps Finance Departments Automate and Optimize FP&A Work, knime.com
- ^ AI in Financial Planning and Analysis (FP&A) Using Python, theamitos.com
- ^ "13 Best FP&A Software Solutions In 2025", f9finance.com