The FP&A Guide

It stands for Financial Planning and Analysis (FP&A) and is the forward-looking arm of the CFO office.

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Within every mature company, there is a CFO (Chief Financial Officer) department that houses a number of different finance teams (Accounting, FP&A, Treasury, etc.) and varies based on the company size and industry.

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The primary role of FP&A is to tell the story of the business (past, present, and future) through the lens of the financial performance. This often includes mixing financial accounts (like revenue and expenses) with business operational metrics (like customer churn or call volumes) to develop a robust storyline.

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Why is storytelling the main output of FP&A?

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A few reasons:

1. Humans digest information best with stories

2. Stories give context to otherwise sterile numbers on a P&L

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And while storytelling is a critical output of FP&A, it's what the business leaders do with that story that sets the best FP&A teams apart from the rest.

 

Our goal in FP&A is to help business leaders make better business decisions that positively change the outcomes of the business. This can be through more growth, better profitability, less earnings volatility, or higher valuations.

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FP&A is often considered the performance engine of the business.

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I like to think of us as the scorekeepers and coaches of the business. We help business leaders align on a singular vision of success, objectively measure against it, then help business leaders achieve it.

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The purpose of this guide is to help you understand exactly how FP&A drives company performance.

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Let's jump in!