Course Summary:

All organisations need to manage performance so that their financial and strategic objectives are achieved and management and financial stakeholders can be confident in the associated control processes. The proper construction and control of budgets is central to this, to safeguard the organisation’s viability and the effective delivery of its objectives. This requires a comprehensive financial planning and approval framework; consistent and rigorous processes for constructing budgets, both capital and revenue; sound methodologies for assessing the financial impact of proposed expenditure; compatibility with other management and performance data, and a control system that sets clear responsibilities and produces prompt and accurate monitoring information on performance against budgets.

This course is designed to equip all Staff involved in the budgeting and forecasting process, and their supervisors and managers. This programme will benefit professionals who want who want to round out their professional education as they take on more management responsibility.

Course Objectives:

• Have a good understanding of the basics of budgeting and forecasting
• Appreciate the need for developing accurate budgets and forecasts.
• Contributing effectively to Strategic Planning
• Link budgeting and forecasting into the business' strategy
• Prepare rolling forecasts
• Guide operational management in the effective use of budget and forecast data
• Implement  costs cutting initiatives and improve effectiveness

Course Outline

Linking the Tactical Budget to Strategic Objectives

• The Strategic Planning Process and the Budget as a Plan
• Aligning the Budget with the Organization’s Strategy

Principles of Budgeting and Cost Control

• The Critical Functions of Management
• Is Control the Missing Link?
• Role of cost management in the business strategy
• Cost management and motivation
• Embedding cost control in the business
• Role of Finance in cost control

Budgeting and Costing Techniques

• Forecasting Methods
• Break-Even Analysis
• Use of Standards
• Trend Analysis and Cost Estimation

Rolling Forecasts

• Role of forecasts and the link to strategy
• Comparing and contrasting budgets and forecasts
• Identifying key business drivers
• The rolling forecast process
• Forecasting methods

Management use of budget and forecast data

• The different types of reports and their use
• Developing quality commentary
• Structuring the monthly management meeting to best use the new information
• Reporting software

Project Budgeting

• Project Planning
• Direct and Indirect Project Costs

Capital Expenditure Budgeting and Analysis

• Time Value of Money
• Investment Appraisal techniques - Pay-Back Period (PBP) ;Net Present Value (NPV) ;Internal Rate of Return (IRR) ;Profitability Index (PI) ;Accounting Rate of Return (ARR)
• Approval for Expenditure (AFE)
• Sensitivity and Risk Analysis

Cost Control and Management Budget Reports

• Budget as a Control Tool
• Approaches to Cost Control
• Understanding the Need for Timeliness and Precision
• Variance Analysis
• Problems in Budgeting