FP&A Today The Chief Forecaster will See You Now-Nate Kaemingk
Nov 26, 2024
Nate Kaemingk, Chief Forecaster at BetterForecasting.com and former fractional CFO, dives into the world of AI-driven financial forecasting. He discusses the transition from annual budgets to rolling forecasts, highlighting the importance of real-time updates and market responsiveness. Nate also explores the significance of probabilistic forecasting and how small errors can cause major cash discrepancies. Plus, hear about his unique journey, including a three-year RV adventure, and his favorite Excel function!
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Probabilistic Forecasting
- Probabilistic forecasting uses small data and inferential statistics.
- Financial forecasting lacks big data; five years of statements mean only five Octobers.
Nate's Background
- Nate Kaemingk's background is in mechanical engineering, where he used inferential statistics.
- He later applied these methods in financial forecasting, noticing a gap in tools and founding Better Forecasting.
Budget vs. Forecast
- Understand that a budget includes target, forecast, plan, and plan's expected outcome.
- Update the plan when actuals deviate; don't just adjust the remaining budget.