Contents:
What is a 'Quick Start Forecast'?
When you choose the ‘Quick Start’ forecast option, Fathom will set up your default value rules & timing profiles, your default account linkages, your tax settings, and any loans and depreciation accounts for you. This allows you to immediately jump into a forecast.
Once you are in your forecast, you can change any and all of the defaults Fathom set up as part of the ‘Quick Start’ onboarding. The ‘Quick Start’ onboarding simply gets you into forecasting more quickly and does not limit you in customizing your forecast.
💡Pro Tip: When you first enter Fathom forecasting, there are three different onboarding options (Custom Forecast, Quick Start, and Link to Budget). Learn more in the 'Creating a Forecast in Fathom' article. |
Methodology
As part of the 'Quick Start Forecast' onboarding process, Fathom determines the:
💡Pro Tip: Timing profiles will all be set so that any revenue or expenses will all be received or paid in the same month they are recognised on the P&L. If you have AR, AP, Deferred Revenue, and/or Prepayment accounts, then you'll need to further customise the timing profiles so those accounts are calculated correctly in the forecast once the onboarding process is complete. |
Default Account Linkages
Fathom will identify your default accounts using keyword matching. This means that if accounts have unexpected names, Fathom may not be able to identify them. You can review and, if necessary, change any and all account linkages in your global Forecast Settings once you are in your forecast.
Your default accounts will be chosen as follows:
Default Account | Reasoning |
Accounts Receivable | Accounts Receivable account with the greatest value |
Accounts Payable | Accounts Payable account with the greatest value |
Cash | The cash account with the most varying value that is in the presentation currency of the company/consolidated group |
Current Earnings | Current Earnings account with the greatest value or, if set up in the ‘Adjustments’ section of ‘Step 1 - Update Data’, the chosen default account. |
Retained Earnings | Retained Earnings account with the greatest value or, if set up in the ‘Adjustments’ section of ‘Step 1 - Update Data’, the chosen default account. |
Prepaid Expense/Unearned Revenue | Not set by Fathom. These are only required once you use a timing profile that includes prepayments and can be set up in your global Forecast Settings. |
Default Value Rules
When starting your forecast via the ‘Quick Start’ onboarding option, Fathom will either set your default value rules as any combination of the following options:
For each account classification, Fathom will determine which of the three value rules is best for your company’s forecast by taking your past financial data and running a forecast to test for accuracy in predicting your more recent actuals.
Fathom will take your financial data from X months ago and run it using the ‘Link to Previous Period’ value rule (month, quarter, and year will be tested) to see how accurate the value rule is in predicting your financial data for more recent months. Then, Fathom will do the same using Smart Prediction (both linear regression and average options for 3 months, 6 months, 12 months, 24 months +/- seasonality) and determine which value rule option yields more accurate results, or the results with the smallest variance, in predicting your more recent actuals.
The value rule that is most accurate for each classification will be set up by Fathom as the default value rule for that account classification.
❗Note: The ‘Smart Prediction’ value rule can only be used if you have at least three months of historic financials. If you have less than three months of actuals imported into Fathom, then the default value rule will be set to ‘Link to Previous Period’ and link to the most recent month’s actuals. |
Tax Settings
Fathom will identify tax accounts based on account classification and keyword matching across all tax types. If you are using a cloud-based source accounting system, then Fathom will query the system to determine the appropriate tax rates.
Fathom will calculate a blended rate for all Tax Expenses based on the sum of earnings accounts compared to the sum of tax expense accounts.
Loans, Schedules, & Depreciation
Loans & Schedules
Fathom will identify any Long Term Debt and Short Term Debt accounts based on their account classification. To ensure we’re not setting up loan schedules for debt accounts that are not loans, Fathom will identify debt accounts with a positive balance that has consistently decreased over the last 3 months. Using the accounts’ historic values, we will calculate a blended Interest Rate. Schedules will be created for all of the identified accounts, posting to the Interest Rate Expense account with the greatest value.
The loan repayment amount will be based on the average monthly decrease in the debt accounts over the last 3 months.
Fathom assumes a default loan term of 20 years.
Depreciation
Fathom identifies the three Fixed Asset accounts with the greatest value based on their most recent balance and account classification. We then use the historic values in these accounts to form an average depreciation percentage, and use this as the percentage applied to the top 3 fixed asset accounts. Then, the calculated depreciation amount will be added to the depreciation account with the largest balance.
You can view any depreciation schedules by,
|
Onboarding Process
To set up a ‘Quick Start Forecast',
|
Fathom will calculate the best options for the forecast and you’ll be taken directly to the forecasting main grid.
Next steps
Congratulations on completing the 'Quick Start Forecast' onboarding! You should now be in the main grid of your forecast. Continue the 'Forecast Creation & Setup Workflow' by choosing from one of the next steps below:
What you want to do: | Where to go next: |
Navigate the main forecasting grid | |
Tailor and customise your forecast with value rules |
Additional knowledge & common questions: