Roll Forward

Roll forward is a term used in accounting to describe the process of updating financial information from one period to the next. This is done by taking the ending balance of one period and adding any new transactions or adjustments to arrive at the beginning balance of the next period.

For example, if a company has a balance of $100,000 at the end of January, and it makes $50,000 in sales and incurs $25,000 in expenses in February, the roll forward would be as follows:

• Beginning balance: $100,000
• Sales: $50,000
• Expenses: $25,000
• Ending balance: $125,000

The roll forward process is important for ensuring that financial information is accurate and up-to-date. It is also used to calculate financial ratios and other metrics that are used to analyze a company's financial health.

There are a few different ways to perform a roll forward. One common method is to use a spreadsheet. Another method is to use a specialized accounting software program.

The roll forward process is a critical part of the accounting cycle. It ensures that financial information is accurate and up-to-date, and it is used to calculate financial ratios and other metrics that are used to analyze a company's financial health.