Building a Better Business Through Budgeting

In this MasterClass webinar, we discuss business budgeting philosophy, techniques, and tools to help you plan and evaluate your company finances.

This webinar was recorded on September 12, 2023.

Target Audience

• All Q360 management roles
• Q360 users interested in the benefits of setting up a budget, and comparing budgeted to actual performance

By the end of the session, you will be able to:

• Understand why budgeting is important
• Build a functional / reasonable budget
• Execute business in alignment with a budget

Agenda:

1. Introduction |0:00
2. Why should we budget? | 01:00
   • Why do we have difficulty planning?
     • • A failure to plan is planning to fail
       • We are better positioned to react if we have a plan

      

   • Can we budget across the business without revealing sensitive financial information?
     • • Get the right people involved in budgeting – across departments or functional areas
       • Q360 offers multiple budget formats and grouping options with varying levels of detail based on your company’s needs

      

   • Start early and review often
     • • Plan a budget several months in advance of the fiscal year start to prevent hasty decision making
       • Align with strategic objectives
       • Adopt an “invest today in a plan that will yield future benefits” mentality

      

3. Getting started | 14:50
   • Set the board
     • • Start early
       • Build historical models
       • Educate non-finance team members
       • Assess the market
       • Define the relationship between daily operations and budget results

      

   • Plan for profit
     • • Be realistic.  Set both average and stretch targets
       • Anticipate market changes, supply challenges and labor availability
       • Reassess resources and goals regularly
       • Do not build a budget based on departmental “spend plans”
       • Consider backlog
       • Leverage the Q360 One Dashboard comprehensive financial view and the Q360 Snapshots to compare expectation to reality
       • Take action on what you can control

      

4. Design / Load your budget | 31:16
   • • Gather historical data (3 years monthly income statements if possible)
     • Start with the main account level, plan to incorporate sub accounts in the future
     • Accounting > Budgets > Define Budgets
     • Q360 allows you to Export / Import Load Sheets or create your own
     • Analyze historical data (compare seasonally or quarterly)
     • Start with the end (net profit) in mind
     • Calculate average spending
     • Consider payroll expenses and changes – Zero Based Budgeting or Activity Based Costing?
     • Begin with a gross (company) level budget and refine to the departmental level

    

5. Use your budget | 51:23
   • • Check budget for indications of over optimism / conservatism
     • Routinely (monthly) review budget and actuals with department heads and shareholders
     • Q360 offers a Budget to Actual 12 Period Live Data Report
     • Match budget objectives to specific, measurable actions at the departmental level where possible
     • Use Q360 to analyze variances, export your budget, and re-import as you modify plans to match company objectives

    

6. Wrap Up | 58:51

See more on budgeting:

• Budgets (Create, Import budgets in Q360)
• Budget Groups (Define budget groups in Q360 for ease of printing)
• NSCA 7 Steps to More Proactive Budgeting
• NSCA Does Your Proposed Budget Hold Water?