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Course Overview:
Program Aim
It is important to understand the principal factors required to produce a successful business case. Developing budgeting & financial skills are required for better decision making. This course gives delegates the skills to manage departmental budgets, monitor divisional costs and apportion department expenses on an appropriate basis.
Learning Objectives
By the end of this course you will be able to:
- Manage budgets within your department, division, cost or profit centre.
- Develop an understanding of the budgeting process.
- Work more productively with colleagues from the finance department.
- Prepare and monitor a budget.
- Appreciate the importance of reducing unnecessary departmental costs and working towards increased corporate profitability.
Course Content
Budgeting Preparation
- Budgeting: a famous word but what does it mean? Constructing a definition
- Overview of the budget process (procedures,manuals,timelines)
- Case study: reviewing a simple budget scenario
- Being clear about initial assumptions and limiting factors
- Knowing where to find information that might be needed
- Analyzing potential income and expenditure: what events/occurrences do we need to consider? Internal, external, definite/uncertain
- Nature and behavior of costs
- Charging department expenditure to the correct period - accruals, prepayments and depreciation
- Break-even analysis
- Stock forecasting and how to calculate the minimum quantity needed
- Apportioning overheads
Facing the Actual
- What are the variances and why are they important?
- The budget is the plan i.e. understanding the need to proactively work towards budget and adhere to budget.
- Comparing actuals to budgeted monthly
- Comparing actuals to budgeted year to date
- Understanding the significance of changes in variances
- Causes of Budget Variances
- Calculating Variances
- Proper Variance Analysis
- Flexing the budget
The Cash Budget
- Why they are needed? Do high profits necessarily mean everything is going well?
- Case study: Preparing a cash budget
Presenting the Departmental Budget
- Giving clear information
- Presenting the main variables
- Getting agreement
- Putting it clearly onto paper
Reporting on the Budget
- Preparing a report
- Providing the information to make decisions
Personal Development
- Action planning - the essential next steps
- Continuous professional development - what next?
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