Budgeting & Forecasting

Providing Budgeting, planning and forecasting (BP&F) as a three-step strategic planning process for determining and detailing the organization's long- and short-term financial goals

In respect of Forecasting (may be classified into 3 types-qualitative techniques, time series analysis and projection, and causal models) : accumulated historical data and market conditions are deployed to predict financial outcomes for future months or years:

  • Gathering past and current data
  • Performing a preliminary analysis
  • Setting a time frame for the budget
  • Establishing revenue expectations
  • Establishing projected expenses
  • Creation of a contingency fund
  • Implementing the budget- on the basis of various techniques such as Activity-based, Value proposition, Zero-based or Cash flow budgeting.

Creation of Business plan (basic elements: 3M’s- Machine/ matter, men and money): 5-step model is followed in drawing up a business plan –

  • Business description – Type of industry, Product profile, Manufacturing process, Trade practices, Organisation culture, machinery/ concept requirements
  • Competition matrix – defining the edge, product offering, geographical or pricing or service dynamics, best case/ worst case scenarios, SWOT analysis, etc
  • Marketing – Strategy, market positioning, opening up of multiple channels, identifying target customer base, synergising with other market players (wherever feasible), framing result-oriented budgets, etc
  • the above 3 comprise the first M (machine/ matter/concept requirement) of the of any business
  • People – This is the second M in terms of order – comprises of the personnel required based on the business functions and Org structure, designing KRAs (Key result areas) for functional heads, fixation of R and Rs’ (Roles and responsibilities)
  • The most integral part – the 3rd M (Money) – which should corelate with business plan – financial projections to culminate into a business valuation, realistic capturing of the resources (capital and revenue in nature) required, revenue / cost estimations, computation of key financial indicators, preparing a contingency budget, designing a monitoring mechanism, etc

The next step being Financial modelling, whereby a process of gathering information from forecasts and other data is done, followed by simulating of discrete scenarios to analyse what impact they might have on the company’s financial health.

For Budgeting, planning and forecasting (BP&F)

HVCS provides three-step strategic planning process for determining and detailing the organization's long- and short-term financial goals

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