4-2 Pro Forma Financial statements Three important uses: FOrecast the amount of external financing that will be required O Evaluate the impact that changes in the operating plan have on the value of the firm Set appropriate targets for compensation plans Copy right C 2002 by Harcourt, Inc. All rights reserved4 - 2 Copyright © 2002 by Harcourt, Inc. All rights reserved. Pro Forma Financial Statements ◼Three important uses: ⚫Forecast the amount of external financing that will be required ⚫Evaluate the impact that changes in the operating plan have on the value of the firm ⚫Set appropriate targets for compensation plans