Every company, regardless of industry or size, needs to have a corporate budget. Although it may not be the most enjoyable process, it is a necessary one. Since most companies only do annual budgeting, and the contributors to the budget likely forget year to year the issues they experienced when budgeting the previous year. Understanding these pains and issues, recording them and building ‘best practices’ for avoidance can help make next year’s budget process a less time-consuming, and more enjoyable one. Three best practices we recommend to help you and your team with your budgeting process are: Create templates with the end user in mind, Give yourself (and your team) enough time to complete the budget, and Budget more frequently.
Create Templates/Worksheets with the End User in Mind
Ensure the right people are involved with the input, and make sure that any budgeting templates are created with the end user in mind. This will increase ease of use, and provide better end results. If your templates and workbooks are too large or complex, the end user is likely to miss something or produce a budget that contains many errors. Simplify the data as much as you can, without being too vague, and ensure there is open communication between the contributors and approvers.
Give Yourself (and your team) Enough Time to Complete the Budget
Time is money. The budgeting process does take time, but you run the risk of producing an erroneous or lower quality budget if you give your team too much (or little) time to complete it. Too much time, you run the risk of contributors putting off their inputs (numbers) until it is very close to the deadline. Too little time, and contributors will be rushed again to input their information. Outlining a concrete plan with ongoing due dates ensures the process will stay on track. Ensure you leave enough time for analysis as well, rather than just data input. You want to be able to analyze that your end result is a good one, with accurate information.
Consider Budgeting More Frequently
Although most companies budget annually, there are advantages to doing rolling forecasting. Budgeting more frequently allows you and your team to identify pros and cons of the current numbers, and make alterations to certain departments, programs and other areas of spending if need be. This saves time overall in comparison to an annual budget, and prevents some of those costly year-end expenses.
Each organization has its reason for budgeting, and each one is important. Following the above best practices can help save your team time and money during the budgeting process. At True Sky, we know budgeting isn’t the most fun time of year. However, it is a necessary process. We can help make it easier for you and your team. Find out how by calling us today at 1 855 878 3759, or visit our website www.truesky.com