Creating a Sound Budget
Creating a realistic budget is a must for any company. A solid understanding on how to create a budget can help you grow your business and help you get out of debt by optimizing expenditures.
If you haven’t created your budget yet, take a look at these tips:
Set a Time Frame for your budget.
Many businesses do 12-month budget starting from July.
Work on your fixed costs. Start working on those expenses that are not expected to change during the period.
Check your variable costs such as utilities, costs of materials, etc. Don’t take costs for granted. Make sure these are necessary to run your business.
Things get a bit complicated when it comes to forecasting. Income budget is used to make financial plans and pinpoint which stream of income is the most lucrative at any given time. Make sure the expected income is realistic. Be conservative and use all the data that is available to you to make this decision.
So now you have a budget which will provide you and other stakeholders some guidance through the new financial year.
Actuals: it reflects how much revenue has been actually generated and how much money has been paid out in expenditures at a given point in time during a fiscal year. Record the actuals, and calculate the difference between your budgeted amount and actual income and expenses.
Take action: how did the budget perform against the actuals? You may need to make changes based on your analyses.
Having issues to keep track of costs? Get a professional on the job. You may want to look into outsourcing
Back Office Shared Services (BOSS) is the only Australian outsourcing and offshoring company who specializes in the Security and Cleaning Industry.