In this document I will provide a guideline with the steps to follow that I believe are most relevant to develop a good budget.
Before thinking about numbers and projects, it is important to take a look and rethink, confirm or adapt the pillars that support the organization (e.g.: what focus do I want to put on the client, what result do I want in the budget? At the end of the year, define the desired internal management, etc.).
Budget planning (for the following year) usually begins at the beginning of the second semester, during which time the baselines are established. This base supports the essential pillars of the organization, which are reviewed and approved by the Board of Directors and the General Manager (Executive Director).
At Simon of Cyrene we call these pillars (“strategic objectives”) “Big Objectives”. At this point we review the mission of the institution and confirm where we want to go as an institution. This is achieved by defining the 4 or 5 main objectives that are sought for the year being planned.
Based on the Major Objectives already approved by the Board, each area must australia number for whatsapp draw up its own strategic plan and the area objectives will be derived from this plan. Each of these objectives must have its own indicator.
Once the strategic and area objectives have been confirmed, the budget can be prepared by each area. At this stage, the portfolio of projects to be executed within the next year will be defined.
In order for each area to be able to correctly prepare its budget, the managers or supervisors must be “trained” so that everyone speaks the same language and has the same structure in this budget preparation. In addition to this training, they must be previously informed of the goal to be met or the challenge for that year (Results, Margin, Income for the year, etc.).
A good way to review the budget already prepared by each area is to do a “cross-check.” This means that the heads of departments exchange budgets, review them, and ask each other questions if any doubts arise. This helps reduce the likelihood of future errors.
Once the above points have been completed, the person in charge of Administration or Planning gathers the information from each area, makes the relevant adjustments and once the previously required goals have been met, the budget can be closed.
A budget will always vary throughout the year, but it is very important to have a baseline for comparison, which allows for identifying changes, improvements or losses throughout the year.
The budget prepared is closed (hopefully in December of the year) and no further changes are made, thus becoming the point of comparison in the progress statements throughout the year in execution.
“Start by asking yourself what events you would like to see happen in the period for the next year and what income and expenses are associated with each of them.”
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