Way to incorporate management goals

Question

Explain in brief the way to incorporate management goals into pro forma financial statements.

Answer 1

Management makes a target goal and forecaster makes use of data from budgets into pro forma financial statements assuming that the budget figures will occur.

For illustration, if goal of the management is to pay off all small-term notes in next year, then forecasters will include this in the pro forma balance sheet by making Notes Payable to zero.