Definition
It measures the accuracy of your forecast. It’s the relative difference (in %) between what you forecasted and what you end up closing.
It is calculated as
( [Forecast for the period] - [New ARR in the period] ) / [New ARR in the period] * 100
The forecast for the period should be a snapshot taken at the beginning of the quarter (or month, if your forecast monthly). It’s a good practice to measure it 2-3 weeks into the quarter (or days in case of monthly forecast) to allow for cleanup.