Successful Budgeting

A budget is a plan that outlines an organization’s financial or operational goals. It is an action plan; it helps a business allocate resources, evaluate performance, and formulate plans. Understanding the importance of budgeting is the first step in successful financial planning.

This budgeting and forecasting program will help demystify the world of budgeting and provide participants with the techniques and confidence to manage and control their budget effectively. Financial terms and budgeting tools will be explained in a way that a manager will understand and relate to in his own line of work.

Program Contents

• Define planning and its relationship to the budgeting process
• Explain why companies prepare budgets.
• Describe the planning cycle inside the organization

• Budgeting cycle in an organization
• The major contents of the annual business plan
• The different types of budgets, their purposes, and limitations
• The relationship between budgets and forecasts

• The sequence of steps in preparing an operating budget
• Prepare a sales and cost of sales budget
• Calculate available labor hours and use this figure to plan headcount
• Calculate budgeted overhead rates
• Labor, materials, and overhead costs in total and per unit
• How to budget operating expenses

• Prepare a departmental spending budget
• Prepare expenses budget
• Prepare a capital budget
• Justify capital expenditures

• Identify significant variances
• Analyze budget variances
• Describe the characteristics of a good budget reporting system
• Determine when a budget should be revised during the year