Budgeting and forecast

Budgeting and forecast

One of the biggest problems for an organisation is the lack of a forecast and a big surprise at the end of the year that something didn’t go to plan.

Without knowing how much money you will have in your pocket, you cannot simply predict whether you can afford to pay wages or invest in new machinery. At the same time without allocating the costs to activities, it is difficult to measure how effective your business processes are.

Key elements to prepare a budget:

  1. Define all the processes within your organisation.
  2. Indicate what the Key Performance Indicators are for the business activities to be able to control the progress.
  3. Allocate the costs for the activities in your business.
  4. Prepare a cash flow forecast to decide upon any short and longer term investments.

Once you prepare the budget and forecast cash flow you will be stood on firmer ground to manage your business.

Cash flow

A cash flow provides critical information in assessing your company’s liquidity, quality of earnings and solvency.

It is critical for a business to keep adequate cash in hand to meet day-to-day expenditures and to invest as and when required in business. It can be the case that in spite of a business having adequate profit, they are unable to meet their taxes and dividends, simply because of a shortage of cash flow.

While revenue statements and balance sheets provide essential information about operating activities and the financial position of a firm, they are unable to convey anything about the cash generation from all business activities.

We help our clients to ensure they have a good cash flow in order for them to achieve their goals and ultimately – business success. We’ll help you to manage and maintain your bank balance, implementing strategic business planning to ensure your outgoings are met and your customers pay you on time.