Revenue Forecast Methods

You must define the price quote and pipeline forecast methods before creating a revenue forecast as these methods control how WorkBook distributes the Remaining Amount.

To define the price quote and pipeline forecast methods, go to Settings > Finance > Revenue Forecast Methods.

Changing the forecast methods for price quotes and pipeline activities does not change the values in existing revenue forecasts. You need to create a new revenue forecast if you want to have a forecast based on new price quote and pipeline forecast methods.

Price Quote Forecast Methods

There are four forecast methods for the price quote:

• Even Distribution Over Time: Divides the Remaining amount among the number of months from the forecast start date to the job’s end date. Workbook uses the Remaining following years column to summarize the value of future months that are not included in the forecast.

• Use Billing Plan: This is the only method where the Remaining Amount is not distributed. This method looks at billing plans for the included price quotes and inserts the values using a 1:1 ratio, summarized by month.

• Schedule Future Amounts Proportionally: Calculates the forecast value as a proportional percentage of the Remaining Amount for each month based on the total of the scheduled values. If there are no scheduled values to calculate the forecast from, WorkBook inserts the remaining value into the first forecast month.

  For example:

  • Remaining amount = 500
  • Schedule value of forecast month 1 = 50
  • Schedule value of forecast month 2 = 100
  • Schedule value of forecast month 3 = 50

  WorkBook computes the forecast values as follows:

  • Month 1 = 125 ([500/200]*50)
  • Month 2 = 250 ([500/200]*100)
  • Month 3 = 125 ([500/200]*50)

• EAC Distribution Method: Calculates a monthly value on the basis of the price quote net revenue, actual, and scheduled monthly value. If there are no scheduled values from which to calculate forecast from, WorkBook inserts the remaining value into the first forecast month.

  For example:

  • Month 1 = ([Previous Actual + YTD actuals + Scheduled month 1] / [Previous Actual + YTD actuals + Total schedule] * Price quote net revenue) - (Previous actual + YTD Actuals)

  • Month 2 = ([Previous Actual + YTD actuals + Scheduled month 1 + Scheduled month 2] / [Previous Actual + YTD actuals + Total schedule] * Price quote net revenue) - (Previous actual + YTD Actuals) - Calculated revenue month 1

  • Month 3 = ([Previous Actual + YTD actuals + Scheduled month 1 + Scheduled month 2 + Scheduled month 3]/ [Previous Actual + YTD actuals + Total schedule] * Price quote net revenue) - (Previous actual + YTD Actuals) - (Calculated revenue month 1 + Calculated revenue month 2)

Pipeline Forecast Methods

There are two forecast methods for the pipeline:

• Even Distribution Over Time: If System Variable 962 is not selected in Settings, WorkBook evenly distributes the future amount, which is derived from the pipeline start date and number of pipeline months, among the months in the pipeline period. If System Variable 962 is selected, WorkBook distributes the future amount evenly among the months in the billing plan period.
• Use Billing Plan: Inserts billing plan values using a 1:1 ratio, summarized by month. This setting is only valid when System Variable 962 is selected in the Settings module.