Competencies for Effective Finance and Budgeting Management
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Competencies for Effective Finance and Budgeting Management Course
Introduction:
Planning and budgeting are essential skills that professionals in any field and at any managerial level should possess. This course is designed to equip you with a comprehensive understanding of budgeting as a multifaceted tool for planning, financial management, and control.
Throughout the course, we will explore the concept of budgeting and its various dimensions. You will learn how budgeting serves as a powerful planning tool, allowing organizations to set clear objectives and allocate resources accordingly. Additionally, we will delve into the financial aspects of budgeting, examining how it facilitates financial management by providing insights into revenue generation, cost control, and profitability.
Moreover, this course will provide you with practical application tools to make informed long-term and short-term planning decisions. You will learn techniques to forecast revenues and expenses, set realistic targets, and monitor performance against budgeted goals. These skills will enable you to make effective decisions that align with organizational objectives and drive success.
By the end of this course, you will have a solid foundation in planning and budgeting, empowering you to contribute to the financial health and strategic direction of your organization. Whether you are a manager or an aspiring professional, this course will provide you with the essential skills to navigate the complexities of budgeting and make sound planning decisions. Join us on this educational journey to enhance your planning and budgeting capabilities and propel your career forward.
Course Objectives:
At the end of this Competencies for Effective Finance and Budgeting Management Course, learners will be able to do:
- Defend the importance of linking an organization's budget with its strategic plan
- Demonstrate how the budget relates to the key financial statements: balance sheet, income statement, and cash flow
- Prepare the key elements of an operating and capital budget and evaluate the different budgeting approaches used
- Apply cost control tools, analyze management variance reports and take proper corrective action
- Calculate different capital budgeting evaluation techniques as included in a capital expenditure proposal
- Utilize cost-volume-profit analysis in making budgeting decisions
Who Should Attend?
All managers, supervisors, and analysts who prepare or use management budgets.
Course Outlines:
Planning and the Functions of Management
- The critical functions of management
- Aligning the budget with the strategy of the organization
- Road map to strategy
- Budget as a planning tool
- Control: the missing link
- Planning pitfalls
The Key Financial Statements
- The accounting system
- The income statements
- The balance sheets
- The cash flow statement
Budgeting: Process and Approaches
- The advantages of budgeting
- The budget processes
- Rolling budgets
- The master budgets
- Operating and capital budgets
- The budgeted financial statements
- Approaches to budgeting:
- Incremental budgeting
- Zero-based budgeting
- Flexible budgeting
- Kaizen budgeting and continuous improvement
- Activity-based budgeting
- Tools of forecasting
- Direct and indirect costs
- Characteristics of an effective budget
- Problems in budgeting
Cost Control
- Budget as a control tool
- The control processes
- Characteristics of an effective control system
- Responsibility reporting
- Variance analysis: identifying the components of variance
- Variance analysis: taking the corrective action
Capital Expenditure Budgeting and Analysis
- Time value of money
- Simple versus compound interest
- Identifying and analyzing cash flows
- The discount rate: using the cost of capital
- Net Present Value (NPV)
- Internal Rate of Return (IRR)
- Profitability Index (PI)
- Pay-Back Period (PBP)
- Accounting Rate of Return (ARR)
- Approval for Expenditure (AFE)
- Sensitivity and risk analysis
Cost-Volume-Profit analysis (CVP)
- Identifying the fixed costs and variable costs
- Computing breakeven point in units
- Computing breakeven point in sales
- Assumptions of CVP analysis
- Using CVP in budgeting decisions