Sam Sheppard, CPA, has been asked by the management of his client, Indian Togs, Inc., to examine the financial forecast of the company for the coming year.

a. What is a financial forecast, and how does it differ from a financial projection?

b. What is the objective of Sheppard's examination of the company's financial forecast?

c. What procedures might Sheppard use to evaluate (1) the assumptions and (2) the preparation and presentation of the forecast?

d. Assuming that Sheppard's examination is satisfactory, draft a report on the examination of the financial forecast.