pro forma financial statement

(redirected from Pro Forma Income Statement)

Pro Forma Financial Statement

A financial statement that a company prepares to consider the effects of a potential activity. For example, if a company is considering acquiring another, it may prepare a pro forma financial statement to estimate what effect the acquisition would have on its own financial circumstances. A pro forma financial statement can be part of the risk analysis of a situation. See also: Due diligence.

pro forma financial statement

A financial statement constructed from projected amounts. A firm might construct a pro forma income statement based on projected revenues and costs for the following year. Likewise, a firm may wish to develop a set of pro forma statements to determine the effect of a projected stock buyback.
References in periodicals archive ?
GAAP, so the result won't match up with the Pro Forma Income Statement we've already created (see Figure 2 and the June 2010 article).
Obviously, no one would apply the above formula without preparing at least a rough pro forma income statement that eliminates fees from doubtful clients and atypical expenses.
Along with the Cash Budget, this Excel-based Pro Forma Income Statement summarizes the results of all the information needed to interpret variance and cost-volume-profit (CVP) analyses, and the Pro Forma Balance Sheet provides the numbers that you'll use as the starting point for next year's budget.
These models include a loan amortization schedule, pro forma income statement and balance sheet, ratio analysis and weekly expense report.
Using this information, pro forma income statements are provided for major product categories in selected global regions.