Planning and budgeting are must-have skills for all professionals regardless of their function or managerial level. This course covers the concept of budgeting as a planning tool, a financial device and a control mechanism.
By the end of the course, participants will be able to:
- Defend the importance of linking an organization's budget with its strategic plan
- Demonstrate how the budget relates to the key financial statements: balance sheet, income statement, and cash flow
- Prepare the key elements of an operating and capital budget and evaluate the different budgeting approaches used
- Apply cost control tools, analyze management variance reports and take proper corrective action
All managers, supervisors and analysts who prepare or use management budgets.
Planning and the functions of management
- The critical functions of management
- Aligning the budget with the strategy of the organization
- Road map to strategy
- Budget as a planning tool
- Control: the missing link
- Planning pitfalls
The key financial statements
- The accounting system
- The income statement
- The balance sheet
- The cash flow statement
Budgeting: process and approaches
- The advantages of budgeting
- The budget process
- Rolling budgetsThe master budget
- Operating and capital budgets
- The budgeted financial statements
- Approaches to budgeting:
- Incremental budgeting
- Zero based budgeting
- Flexible budgeting
- Kaizen budgeting and continuous improvement
- Activity based budgeting
- Characteristics of an effective budget
- Problems in budgeting
Cost control
- Budget as a control tool
- The control process
- Characteristics of an effective control system
- Responsibility reporting
- Variance analysis: identifying the components of variance
- Variance analysis: taking the corrective action
