Why is Regular Long-Term Financial Planning Important?Here are the reasons for undertaking a regular financial planning process:
- To determine financial position and condition. Regularly highlight long-term financial condition and issues.
- To build the case for action. Make stakeholders aware of long-term issues and increase their desire to confront them.
- To develop a mix of strategies. Make sure you have long-term strategies to complement your short-term ones.
- To build trust with citizens. Citizens are often prepared to pay more in taxes if that is necessary to realize the future they want, but only if steps are taken to increase accountability and trust. Financial planning provides great accountability for how resources are used.
- To comply with rating agency expectations. Financial planning is described by Standard and Poor’s as one of the “top 10 management characteristics of highly rated credits.”
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