Explain how the concepts of additivity and articulation apply to financial statement forecasts and discuss how these concepts can help analysts avoid potential forecast errors

Financial statements are usually used to show the business the way it performs both now and in future. It gives a good trend on how one thinks of how the business can perform overtime. They indicate how the businesses have been performing overtime especially in terms of the profitability, the flow of the cash, liabilities and the assets. Therefore, the financial forecasts help the company to predict the future and how it will sustain the waves affecting the business.

The concept of articulation and additively elaborate on how changing the values that have errors to suit the balance sheet. Therefore, this process involves checking the daily operations to ascertain that there is no problem on how the financial figures are put in the books. If these concepts are done to the various transactions that are done on daily basis, it will help the analysts to overcome the problem of future errors in the forecast because the analysis depends on the daily records that are done correctly. All organizations need to come up with a strategy that will enable them to apply the two concepts in their daily transactions as this will be helpful in future analysis of the company. Correct data is important in a company’s analysis.