Budget Development and Management

Course review:

Everybody in an organisation has an involvement with budgets and budgetary control. If you are a budget holder, or about to become one, you will be required to contribute to the process of reviewing and updating your budget, apart from ensuring the operational adherence to it. This course will prepare you for both.

The 'Budget' is really a system of linked budgets, with the projected revenue for the next 1-3 years as the top of the 'pyramid' of inter-linked functional and financial budgets. The revenue budget is based on assumptions about process and volumes of the products and services that the organisation expects to sell or provide. The aggregated budgeted costs will reveal, early in the process, whether the expected profit gives an acceptable return on investment.

Budgeting is an interactive process requiring review and refinement until the whole set of budgets makes sense, and is agreed by the directors.

It is not simply, a matter of looking at last year's 'actual' and adding 'a bit', although that can happen if the process is not managed effectively.

By the end of this course, delegates will be able to:-

• identify and design the different types of budgets for Operations; Departmental activities; Marketing; Capital Expenditure and Cashflow.
• Set a realistic and workable budget timetable.
• Locate and analyse sources of financial, operating and marketing data.
• Understand business costs - fixed and variable.
• Develop a 'First-cut' contribution-based budget - a quick view of profitability.
• Prepare detailed forecasts of business activity and resource requirements.
• Design and prepare budget schedules.
• Design and implement a performance reporting system.
• Understand how to use Zero-based budgeting in validating resource levels and allocations.
• Review the budget system in your own organisation.