What is described as the process of estimating future financial outcomes?

The correct answer is financial forecasting, which refers to the process of estimating future financial outcomes based on historical data, current financial conditions, and various assumptions about future business activities. This process is vital for businesses as it aids in planning and decision-making, allowing organizations to prepare for potential challenges and opportunities. By analyzing trends and patterns, financial forecasting helps in projecting revenues, expenses, and overall financial performance, giving stakeholders a clearer view of what to expect and enabling better strategic planning.

While other choices, like financial auditing, cost accounting, and budgeting, are related to financial management, they serve different functions. Financial auditing pertains to the examination of financial records to ensure accuracy and compliance, often after the fact. Cost accounting focuses on capturing a company's total cost of production, which aids in internal decision-making but does not involve future projections. Budgeting, while it might involve forecasting as part of the process of creating a budget, specifically refers to the allocation of resources based on estimates. Thus, financial forecasting stands out as the primary process dedicated to estimating future financial outcomes.