Financial Planning & Analysis (FP&A) involves analyzing financial data, understanding trends, forecasting future financial performance, and informing strategic decisions to align with an organization's objectives. This function is vital in developing budgets, setting financial goals, and providing insights into areas such as revenue growth, cost management, and risk assessment.

FP&A professionals often work closely with other departments to gather relevant data and assumptions to create detailed financial models that simulate different scenarios. These models help predict the financial outcomes of business decisions, guiding organizations in formulating their strategies. For instance, FP&A can assist in deciding whether to expand operations, invest in a new product line, or optimize current resources for efficiency.

For example, a company might use FP&A to determine projected revenues based on trends in sales data and market conditions, subsequently influencing its decision to allocate additional budget to marketing in promising regions. Terms like 'budget,' 'forecast,' and 'financial analysis' are commonly associated with FP&A, highlighting its role as a cornerstone for organizational financial health.