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Why bother to budget

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Steve Bicknell
Steve Bicknell

Planning and monitoring a budget is an invaluable tool to help control, prioritize, and manage business finances. It helps reduce waste, adapt to change, and achieve financial goals by providing a summary of likely income and expenses for a given period. Budgeting methods include zero-based, top-down, and bottom-up approaches and can focus on factors like sales, costs of sales, overheads, capital expenditures, and cash cycles. Professional assistance is available to help businesses with budgeting.

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Why bother to budget?
Simply put, a budget is a summary of likely income and expenses for a given period. It is an invaluable tool to help you control, prioritise and manage your business. Planning and monitoring your budget will help you reduce waste, adapt to change and achieve your financial goals.
Budgeting Methods Zero Based Budgeting starting from zero rather than adjusting the previous year Top Down start with the objective and work down into the detail Bottom Up start with the costs and work out the level of sales needed to produce a profit Activity Based Budgeting look at the cost drivers and activity volumes
Sales Budget Prospects Leads Opportunities Work in Progress Order Book Orders Target Estimates Targets
Cost of Sales Wages Materials Direct Overheads
Overheads Fixed Costs Salaries Premises Other
Capital Expenditure
Cash Cycle Debtor Days Stock Days Creditor Days
We Can Help Catherine Machalinski ACMA Farriers Chambers Smith Street Rochdale OL16 1TU e-mail: catherine@prevailaccountancy.co.uk By phone: Tel/Fax: 01706 550 825 Mobile: 077 069 15 444

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Why bother to budget

  • 1. Why bother to budget?
  • 2. Simply put, a budget is a summary of likely income and expenses for a given period. It is an invaluable tool to help you control, prioritise and manage your business. Planning and monitoring your budget will help you reduce waste, adapt to change and achieve your financial goals.
  • 3. Budgeting Methods Zero Based Budgeting starting from zero rather than adjusting the previous year Top Down start with the objective and work down into the detail Bottom Up start with the costs and work out the level of sales needed to produce a profit Activity Based Budgeting look at the cost drivers and activity volumes
  • 4. Sales Budget Prospects Leads Opportunities Work in Progress Order Book Orders Target Estimates Targets
  • 5. Cost of Sales Wages Materials Direct Overheads
  • 6. Overheads Fixed Costs Salaries Premises Other
  • 8. Cash Cycle Debtor Days Stock Days Creditor Days
  • 9. We Can Help Catherine Machalinski ACMA Farriers Chambers Smith Street Rochdale OL16 1TU e-mail: catherine@prevailaccountancy.co.uk By phone: Tel/Fax: 01706 550 825 Mobile: 077 069 15 444