Simply put, the #BusinessBudgeting process exists to provide your company a plan for its spending for the year to come.
Yet, for a seemingly-vital part of keeping business healthy, many companies fall into a routine of creating a #yearlybudget, only to forgot or abandon it weeks or months after they’ve created it. Such a commonly-shared experience is rooted in a misconception that budgets are a one-time roadmap your company should follow as closely as possible throughout the year. (Hint: They’re not.)
As the end of the year closes in, the corporate budgeting process has come into #focus to lead your company into the new year on the #rightfoot. By staying on top of your budget–and following a procedure for best using it throughout the year–your company will be best suited to not only track its finances into the new year but also best plan for the future.
How to keep your budget on track
Base your budget off a solid financial model
Budgets, like your business, are meant to ebb and flow depending on a variety of factors–from political decisions to market events, supply and demand and investments–and should reflect thoughtful predictions and analysis based on what those factors will have on your company’s bottom line.
This starts with a #prebudgeting phase of creating an accurate #financialmodel. Corporate budgeting encompasses the output of your budget forecast financial model and represents your target expenses and revenues for the months ahead – this is all to say that solid corporate budgeting starts with a solid financial model.
Create intervals for revisiting and updating your budget throughout the year
One of the clearest steps to making sure business budgeting efforts don’t go to waste is to create a timeline for revisiting and updating your budget.
Start with what you can control – time. Will you visit your budget on a weekly basis (#PureProfitway) monthly? Quarterly? Bi-annually? Regularly updating your budget allows for your company to know that it has its best foot forward when approaching the next quarter.
Aside from time, your company will likely see changes in economic, political and social climate throughout the year that will factor into how your corporate #bud