FP&A
| FP&A tasks and activities |
Financial Planning and Analysis (FP&A), in accounting and business, refers to the integrated financial management activities of budgeting, forecasting, modeling and analysis, together with their role 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 towards business performance management, encompassing both qualitative and quantitative analysis. This positioning allows management to preemptively address both customer and operational issues. 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 scheduling 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. During its early years - 1960s to 1980s - FP&A relied on spreadsheets; mainly Excel, but in earlier years, Lotus 1-2-3 and VisiCalc. From the 1980s to the early 2000s, FP&A utilized financial modeling and data analytics software such as such as Cognos and Business Objects. From 2000s to present, tools used in FP&A include cloud-based platforms, such as Amazon Web Services (AWS) and Microsoft Azure, and predictive analytics tools, such as SAS, R, and Python.[4]
See also
[edit]- FP&A Professional (FPAC)
- Corporate finance analyst
- Strategic financial management
- 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