What does Pro Forma Financial Statements mean? Read on to discover the definition & meaning of the term Pro Forma Financial Statements - to help you better understand the language used in insurance policies.
Pro Forma Financial Statements
This refers to a set of financial statements (usually an income statement, balance sheet, and statement of cash flow) designed to exhibit future financial results. They are created using known (or sometimes assumed) input data (usually expenses), along with an estimated amount of revenue, to project an estimated amount of earnings. These statements are commonly used for new risk funding programs such as captives and risk retention groups (RRPs).
We hope the you have a better understanding of the meaning of Pro Forma Financial Statements.