INTRODUCTION

Setting budgets is all about how to plan for the expected and the unexpected.

Controlling budgets is all about how to react and respond appropriately when the unexpected happens.

This Setting & Controlling Budgets training course deals comprehensively with the questions you have always wanted to ask about planning, budget setting, and budgetary control, in plain language that is easy to understand. It covers in detail how the tools and techniques of successful budgeting and budgetary control are applied within the overall planning framework to ensure that organisational goals are met.

It clarifies the jargon and methodology, and the links between strategy, budgeting, costing, and performance measurement. The Instructor's own business career experiences and many other real-world business scenarios are shared throughout this stimulating course to illustrate and reinforce the practical application of the tools and techniques and best practices.

Objectives

By the end of this training seminar, participants will have learned how to:

Identify the links between strategic planning, budget setting, and performance measurement

Use alternative approaches to costing for planning, budgeting and budgetary control

Set an operating budget, cash budget, capital budget, and prepare a master budget

Develop budgetary control systems, and analyse variances using flexed budgets.

Course Outline

DAY 1

Strategic and Financial Planning

Financial Accounting and Management Accounting

The Links between Strategic Planning, Budget Setting, and Performance Measurement

Planning and Strategic Management

Mission, Vision, and Objectives

The Planning Process

External Environment Analysis, Internal Resources Analysis, SWOT and PESTEL

Shareholder Wealth Maximisation, value Creation and Financial Strategy

Financial Planning and Modelling, and Long-term and Short-term Financing

DAY 2

Cost Analysis for Budgeting

What is Costing?

Cost Behaviour – fixed costs and variable costs

Contribution, Cost / Volume / Profit (CVP) Analysis and break-even models

Traceable Costs and Non-traceable Cost Allocation

Product Costs and Period Costs – product costing for inventory valuation and profit ascertainment

Direct costs, Indirect costs, Absorption Costing and Marginal costing

Product Costing for Budget Setting, Budgetary Control and Performance Measurement

Refinement of the Costing System and Activity-Based Costing (ABC)

DAY 3

The Framework for Budgeting

What is a Budget – and Why Budget?

The Budgeting Framework and the various Types of Budgets: top down; bottom up; incremental; zero-based; activity-based

The Budget Process

Qualitative and Quantitative Techniques of Forecasting Sales and Costs, and Sales Pricing

Budgeting for Labour Costs and Depreciation

The Departmental Budget

Preparation of the Master Budget and the Cash Forecast / Budget

The Human Side and the Behavioural Aspects of Budgeting

DAY 4

Activity-Based Budgeting (ABB), Capital Budgeting, Budgetary Control and Variance Analysis

How the Budget is controlled in your Organisation

Activity-Based Budgeting (ABB)

Budgeting for Capital Projects

Discounted Cash Flow (DCF) investment appraisal methods of Net Present Value (NPV) and Internal Rate of Return

Capital Rationing and the Profitability Index (PI)

Budgetary Control Systems and Responsibility Accounting

Standard Costing for Budgeting and Budgetary Control

Fixed Budgets, Flexed Budgets, Variance Analysis and the Reasons for Variances

DAY 5

Beyond Budgeting – Broadening Performance Measurement Systems

Integrating Continuous Improvement into the Budget Process

Advantages and Disadvantages of Budgeting

How to Improve the Budget Process in Your Organisation

The Conflict between Performance Improvement and the Costing System

Lean Thinking and Performance Improvement

What next – beyond the Budget?

The Balanced Scorecard – linking strategy with budgeting and with performance measurement

Developing and Adapting the Balanced Scorecard: Financial Perspective; Customer Perspective; Internal Business Process Perspective; Learning and Growth Perspective