In this lesson, Nick Palazzolo, CPA, breaks down the basics of forecasting and projecting within the Business Environment and Concepts (BEC) realm, where wearing the hat of a manager or high-level executive becomes crucial for strategic planning. By exploring why forecasting and projection are essential tools for anticipating future business changes, Nick clarifies the role of projections in simulating various 'what-if' scenarios, typically used for internal decision-making. He also introduces sensitivity and scenario analysis, key sim-based topics that will be examined in greater detail. Moving on, Nick distinguishes forecasts as instruments predicting the most likely business outcomes, and explains their importance in external communications with stakeholders such as banks and investors, while also acknowledging their internal utility. Get ready to dive into the nitty-gritty of projections and how they contrast with forecasts to aid in navigating the future of a business.