The Scot's future seemed uncertain after Forest's Championship play-off semi-final defeat against Blackpool.
But Davies told BBC Radio Nottingham: "I've got two years on my contract. I want to get my head down and look forward to this great challenge.
"Time will tell how we move it forward and what happens in the future."
Davies, 45, met chairman Nigel Doughty last week for what he described as "purposeful" talks.
And in planning for next season, Davies has recommended a number of players to the club's transfer acquisition committee.
The Reds have been linked with Swansea midfielder Darren Pratley and Chelsea defender Patrick van Aanholt, but Davies refused to confirm whether the pair are targets.
He said: "As a professional football club, we want to conduct our business behind closed doors.
"We will let the people who do the negotiation get on with it, and we'll see what develops over the next number of weeks."
Davies agrees, though, that last season's success should help with player recruitment: "It should be easier to persuade players to come to Forest in this position.
"I'm sure there are a number of players out there who would love to join this progressing club, with this great energy that we've got around it and the great enthusiasm with regards to the future.
"But money talks as we all know."
The Reds secured their highest finish for 11 years this season, surprising many as they equalled a long-standing club record for consecutive home wins, and went unbeaten away from home until the end of January.
Davies, though, warns that success one year does not automatically mean success the next.
"There is a coat of paint that separates bottom from top in the Championship," he added.
"We've got to be humble, get our feet back on the ground and realise there is a massive challenge ahead in the Championship next season.
"We over-achieved last season. A top-12 finish was everybody's expectation, and this season was all about building on that top-12 finish.
"It will be a massive, massive challenge and a great team effort again to go and put ourselves in a very strong position."
Source: BBC Sport
Source: BBC Sport