GFOA of the US & Canada

There are five pillars to a sound financial planning process:

A long-term service vision. Define the future the community wants.

Service visioning is a great chance to engage elected officials in the planning process.
A service vision makes planning more meaningful to participants, especially those without a financial background.
It is essential for aligning financial strategy with service strategy.

Financial policies. Define the standards of stewardship of the public’s tax money.

Technically sound analysis and forecasting. Provide accurate and credible financial foresight.

A credible forecast is essential for stakeholders to have confidence in the planning process.
Use scenario analysis to explore different possible futures.
Make sure the forecast is adaptable to changing conditions and requirements.
See GFOA’s MuniCast for improved forecasting

Collaborative and participative process. Gain the benefit of different perspectives.

Improve plan quality by getting different vantage points and accessing different expertise.
Build a wide basis of support for financial strategies.

Connection to other plans. Long-term financial planning is part of a complete planning portfolio.

Integrate with strategic planning to get the long-term service policies and to inject financial realities into service visioning.
Integrate with capital planning to understand long-term capital and operating expenditures and to better model debt scenarios.
Integrate with the budget to put into action long-term financial strategies.
Integrate with land use planning to reveal land use trends that impact financial condition and to emphasize land uses’ implications for financial condition