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Undercast

What is 'Undercast'

A forecasting error that occurs when estimating items such as future cash flows, performance levels or production. Undercasting produces an estimation that is below the realized value.

Explaining 'Undercast'

There are a number of factors that may lead to undercasting values. The primary reason for undercasting involves using the wrong inputs. For example, when estimating the net income of a company for next year, you may undercast the amount if you overestimate costs or underestimate sales. You may have expected sales to be $5 million and costs to be $3 million. This forecasts a net income of $2 million. If actual net income was $2.5 million, you would have undercast the income by $500,000.


Further Reading


Keynes, capital mobility and the crisis of embedded liberalism
www.tandfonline.com [PDF]
… to the middle way was, for Keynes, the break with laissez-faire economics, which he … Keynes envisioned that the role of the economist was to solve the economic problem: the … The postwar international economic order was, as Ruggie argued, designed around the principle of …

Measuring Abnormal Performance in Event Studies: An Application with Bonus Issue Announcements in Colombo Stock Exchange (CSE)Measuring Abnormal Performance in Event Studies: An Application with Bonus Issue Announcements in Colombo Stock Exchange (CSE)
papers.ssrn.com [PDF]
… to the middle way was, for Keynes, the break with laissez-faire economics, which he … Keynes envisioned that the role of the economist was to solve the economic problem: the … The postwar international economic order was, as Ruggie argued, designed around the principle of …

THE IMPACT OF THE USE OF COMPUTERISED ACCOUNTING SYSTEMS IN FINANCIAL REPORTINGTHE IMPACT OF THE USE OF COMPUTERISED ACCOUNTING SYSTEMS IN FINANCIAL REPORTING
ir.csuc.edu.gh [PDF]
… to the middle way was, for Keynes, the break with laissez-faire economics, which he … Keynes envisioned that the role of the economist was to solve the economic problem: the … The postwar international economic order was, as Ruggie argued, designed around the principle of …

Socio-economic restructuring and urban poverty under different welfare regimesSocio-economic restructuring and urban poverty under different welfare regimes
books.google.com [PDF]
… to the middle way was, for Keynes, the break with laissez-faire economics, which he … Keynes envisioned that the role of the economist was to solve the economic problem: the … The postwar international economic order was, as Ruggie argued, designed around the principle of …

West Africa's CO 2 emissions: investigating the economic indicators, forecasting, and proposing pathways to reduce carbon emission levelsWest Africa's CO 2 emissions: investigating the economic indicators, forecasting, and proposing pathways to reduce carbon emission levels
link.springer.com [PDF]
… to the middle way was, for Keynes, the break with laissez-faire economics, which he … Keynes envisioned that the role of the economist was to solve the economic problem: the … The postwar international economic order was, as Ruggie argued, designed around the principle of …



Q&A About Undercast


How can one avoid making forecasting errors like this?

One way to avoid making forecasting errors like this is by using more accurate data in your calculations and projections in order to make better estimates about future events and outcomes based on past experiences with similar situations and circumstances..

What are some factors that may lead to undercasting values?

There are a number of factors that may lead to undercasting values. The primary reason for undercasting involves using the wrong inputs. For example, when estimating the net income of a company for next year, you may undercast the amount if you overestimate costs or underestimate sales. You may have expected sales to be 5 million and costs to be 3 million. This forecasts a net income of 2 million. If actual net income was 2.5 million, you would have undercast the income by $500,000 (2M-2.5M).

What is undercasting?

Undercasting is a forecasting error that occurs when estimating items such as future cash flows, performance levels or production. Undercasting produces an estimation that is below the realized value.