Advanced Budgeting Workshop

Introduction

This course is considered the second level in budgeting after our "Effective Budgeting and Cost Control" program. It goes beyond the theory of budgeting as a concept to over specific steps to make the budget a value-added process in the organization. Bu building user-friendly models and applying scenario analysis, management will spend less time gathering data and more time in analyzing it for decision making. Several Microsoft Excel tools are used throughout this course program to make it practical and to provide participants with the skills needed to apply the tools in their organization immediately. Such tools include 'what-if' and the solver, among many others.

Course Objectives

• Create budget templates and models for their departments or organizations.
• Apply several forecasting techniques to better manage uncertainties in budgeting.
• Evaluate capital budgeting decisions using several methods and recommend proper action.
• Utilize Microsoft Excel functions and tools in the budgeting process.
• Evaluate the budgeting process in their organization and recommend improvements.

Course Outlines

Day 1: Budgeting and Planning

• The budget and the functions of management.
• Budget as a planning tools.
• Budget and the key financial statements.
• Top-down versus bottom-up process.

Day 2: Budget Cycle, Process and approaches

• The budget cycle.
• The characteristics of successful budgeting.
• Making the budget a value-adding activity.
• Top tem problems with budgeting.
• Choosing the proper budgeting approach.
• Incremental budgeting.
• Zero-based Budgeting.
• Flexible Budgeting.
• Kaizen Budgeting.
• Activity based budgeting.
• Rolling (continuous) budgets and forecasts.
• The master budget and its components.
• Operating and capital budgets.
• Best practices in budgeting.
• Creating a user friendly template.

Day 3: Forecasting Techniques

• Forecasting models'.
• Qualitative and quantitative methods.
• Steps in developing forecasting models.
• Time series and trend analysis.
• Data conditioning techniques.
• Exponential smoothing and moving averages.
• Simple and multiple regression analysis.

Day 4: Advanced capital budgeting evaluation techniques

• Business risks and capital.
• Classifying investment projects.
• Cash flow estimation.
• Analyzing investment and operating cash flows.
• Time value of money concepts.
• The required rate of return.
• Net Present Value (NPV).
• Internal Rate of Return (IRR).
• Multiple Internal Rate of Return (MIRR).
• Profitability Inderx (PI).
• Payback period and discounted payback period.
• Capital rationing.
• Comparing and evaluating techniques.
• Sensitivity and risk analysis.

Day 5: Breakeven analysis and optimization techniques

• Cost Volume Profit (CVP) analysis.
• Using CVP to reach a target income.
• Single product and multiple products breakeven analysis.
• Working with budget constraints.
• Building optimization models.