Effective Budgeting, Planning & Control

In order to make better business decisions, decision makers need to understand the fundamentals of budgeting and costing. This training course has been devised to give business decision makers a good understanding on budgets, cost controls, variances and associated analysis that will lead to better decisions being made & better results being attained. The Effective Budgeting & Cost Control training course will clarify budgeting terms; clearly explain the methodology used and cover both traditional & non-traditional budgeting methods through to newer methods and approaches. We will take the same approach with all elements of costing.

All personnel involved in preparation of budgets Budget supervisors Operational managers Productions managers Financial managers Others who provide and enter information Anyone else who wants to understand budgets and costing within their business

Unit 1: The Essentials of Budgeting: Strategic Planning, Forecasting, Budgeting, and Costing – Defined The inter-relationship of Strategic Planning, Forecasting, Budgets in planning and control The Benefits & Limitations of Budgets and the Essential Features & Conditions Required An Evaluation of Various Types of Budgets Fixed Variable Zero Based Activity-Based Capital Budget The Essential Features of Activity-Based Budgeting Developing the ABB application model Budgeting for Processes rather than Departments Defining Key Cost Drivers Defining Key Activities Development of ABB Cost Standards Developing the Activity-Based Budget Preparing The Master Budget using Excel Sales Budgets Production Budgets Cash Budgets Capital Budgets The Master Budget Unit 2: Forecasting Future Sales, Costs, Exchange Rates, Interest Rates: Determine the Purpose or Objective of Forecasting Methods of Forecasting Using Qualitative and Quantitative/Statistical Analysis Including the Exploratory Data Analysis Tools Available in Excel: Their Use & Limitations Recognizing the Basic Patterns Inherent in Historical Data Time Series Analysis Exponential Smoothing Correlation and Regression Analysis Presenting initial forecasts to decision-makers Forecasting future Market/Sector developments using Qualitative Analysis – SWOT Analysis and LEPESTE & Co Analysis Implementing Forecasts into the Budget Control Plan Considering Hedging Strategies where variables such as Exchange Rates and Interest Rates cannot be forecast accurately Forwards, FRAs, Futures, Options, and Swaps Unit 3: Preparing and Implementing Budgets Based on Forecasts: Preparing the Sales Budget Determining the price, credit policy, discount policy, and currency Preparing the Production Budget Preparing the Cash Budget Make finance and investment decisions. Preparing Capital Budgets Use Excel to evaluate various Capital Projects using the Present. Value, Future Value, Net Present Value, Internal Rate of Return, Modified Internal Rate of Return, and Discounted Payback models An Introduction to What If and Sensitivity Analysis to evaluate the implications of changes in significant factors of production and make strategic decisions Implementing Budgets Successfully The Conditions Required The Management Skills Required Unit 4: Break-Even Analysis, Sensitivity Analysis, and What-If Analysis: Break-even analysis, Cost Behaviour, and Sensitivity Analysis Identifying Fixed, Variable, and Semi-variable costs Identification of the level of sales/profit to break even Identification of critical costs Determining resource requirements What if Analysis using Excel and leading software Performing What-If and Sensitivity Analysis to evaluate the implications of changes in significant factors of production and consumption on the Cash Budget and Profit and loss Account Identification of key performance indicators for effective and focused decision-making Recommend various courses of action to manage the What If and Sensitivity Analysis implications. Developing Budget Re-Projection and Best Case / Worst Case Scenario Models Planning for contingencies Developing various scenarios Using the Scenario tool in Excel® to explore the variable sets of assumptions while tracking the impact on the base model. Building the financial simulation model using probabilistic (Monte Carlo) simulation Making the economic simulation model using deterministic simulation Unit 5: Variance Analysis, Reporting, Control, and Decision Making: Accounting Systems, Accountability, and Responsibility Systems Essential Elements of a Costing System Establishing and Implementing a Costing System Undertaking Variance Analysis and Presenting a Variance Report to decision-makers Evaluation of the results Making Strategic Decisions based on the Variance Report/Business Planning