Indirect planning assumptions are made about specific physical or economic items such as revenues, the market for product, or capital expenditures. Direct planning assumptions, on the other hand are usually based on financial ratios.

Indirect Planning Assumptions

Presumptions made about external factors that could influence an organization's planning, without direct control over them.

Direct Planning Assumptions

Fundamental assumptions that are explicitly stated and used as a base in the strategic planning and forecasting processes.

Financial Ratios

Financial Ratios are quantitative measures derived from a company's financial statements to assess its performance, efficiency, profitability, and financial health.