10 What-If Analysis

The What-If Analysis report enables the user to account for the change in profitability owing to any probable changes in the projected components of profitability. The probable change can be defined by the user and is termed as 'Variation'. The user could define the parameters to which variation is being applied and the magnitude of variation. The net effect on profitability as a result of these variations can be applied. Certain users should have the authority to save a scenario which can later be accessed by other users for reference. The variations once applied can be applied on the income statement by either of the following two methods:

• Basic: The variations that are applied get simply aggregated with the modified values of components to show the resulting net income. The basic version supports variations to be applied to multiple parameters at the same time.
• Advanced: The variations that are applied also affect the other components it is correlated to and the modified values of all such parameters get aggregated to show the resulting net income. In the Advanced version, variation can be applied to only a single component at a time.