TOLL FREE: 1 855 TRUE SKY (878 3759)


Read up for news, tips and tricks about budgeting, planning and forecasting.

Corporate Performance Management Financial Information Forecasting and Planning

How should you be Budgeting?

How do you know if a rolling budget and monthly forecasting is right for you? We can start by looking at who it is not right for.

If your business:

  1. Has primarily/only fixed expenses or
  2. Has little fluctuation in revenue or
  3. Is looking to stay status quo and not grow or change over coming years

we will go out on a limb here and say that rolling forecasting is probably not best for you.

Before you commit to a rolling budget, ask yourself what you want to get out of it. This will generally align with your organization’s strategic plan.

Say that you have set an annual goal of increasing revenue by 30% by fiscal year end. You can reach that goal in two ways: either secure one large project that brings in 30% more revenue on its own (depending on your industry, this probably will not be realistic), or bring in multiple smaller-scale projects that add up to 30% more revenue.

If you have planned to do the latter, then you are probably going to be focusing on sales strategies –you need your sales team to meet their targets that will achieve 30% more revenue. So, what you would want to get out of your monthly forecasting is ensuring that you are on track and meeting smaller goals, in order to achieve the long-term vision.

This can apply to any scenario in your business. For example, say you want to reduce administrative costs by 10%, increase your profit margin by 5%, or save up for a big tech investment that will reduce costs over the long-term. All of those scenarios require planning and achievable outcomes that you can target.

What other indicators in an organization indicate you should move from annual to monthly budgeting?