FIN.4:4.1 - Choose the view and establish its starting basis

Name the quantity needed: a cash receipt or payment, operating profit, a projected financial position, cash available to capital providers, or another specified measure. Fix its entity, period, currency, price basis and intended use through FIN.1 where necessary. An annual income forecast and a daily funding account can concern the same activity while requiring different time resolution.

Recover adequate opening balances, commitments and source accounts. Establish the relevant recognition and measurement policies when they affect the bridge. An opening receivable can produce future cash without producing new sales; a customer advance can fund operations before revenue is recognized. Removing either because it is absent from next period’s sales forecast would lose a real cash consequence.

Keep actual observations, estimates, commitments and proposed management actions distinguishable. A signed rent increase is a different forecast input from an expected sales increase; an unapproved capacity addition is a different resource premise from installed capacity. A history can support estimation after correcting a source error or a consequential one-time event, but normalization must not erase a recurring cost merely because it makes the forecast unattractive. Preserve the source amount and explain the adjustment needed by this view.