Budgeting

Financial Budgets in the Age of Intelligent Planning

For far too long, budgets were an annual exercise undertaken to appease the Board and for departments to justify or gain funding. Once completed, the budget sat in a folder and was rarely referred to again until the following year’s budget season. But budgets can be more than a collection of spreadsheets showing static numbers and hopeful projections. For companies with their eyes set on growth, a budget is a strategic asset, a tool used to set short and long-term targets for revenue, expenditures and cash generation.

Of course, in order to live up to its strategic potential, the budget must be easy to build, manipulate, review, approve and update. It must foster collaboration with aIl stakeholders and require no manual intervention by the finance team. More than that, a budget must be relevant and a source of insight throughout the year. This is possible by connecting the budget directly to financial classifications found in the general ledger for a variety of items, including ongoing budget vs. actuals, as well as forecasts at the transactional level. Moreover, by integrating corporate financials with other business domains (e.g. workforce or sales), the CFO can track organization-wide drivers and goals for improving overall performance.

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