Setting & Controlling Budgets
Finance, Accounting & Cybersecurity
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