memory/sops/finance_forecasting_sop.md

SOP-FIN-01: Finance Forecasting Standard Operating Procedure

Owner: Finance desk.

Scope

Next-quarter revenue projection, plan-versus-actual variance, and break-even analysis for every CEO brief.

Required steps

1. Build monthly revenue from cleaned orders via monthly_revenue.
2. Project next quarter using the trailing three months.
3. Apply a confidence band of plus-or-minus 15 percent around the projection.
4. Compare actual revenue to plan_value and produce variance_abs, variance_pct, and variance_flag.
   • favorable if variance is above +2 percent
   • on-plan if variance is within plus-or-minus 2 percent
   • unfavorable if variance is below -2 percent
5. Compute break-even units as fixed_cost / unit_margin.

Output contract

The Finance report must include projection_next_quarter, confidence_band, variance_abs, variance_pct, variance_flag, and break_even_units.