Defining Terms: Forecasts v. Projections—Why Does It Matter?

Business Valuation UpdateVol. 27 No. 6
June 2021
valuation methods & approaches
income approach, cash flow, discounted cash flow (DCF), management projections, projections, cash flow projections

Summary

One area that can trigger some confusion is the difference between the terms “forecast” and “projection.” Some people use them interchangeably, but these are formal terms found in the literature, so they should be used appropriately.