The first group includes the most important ones, vital for the functioning of the enterprise.
The second group includes projects that promise high returns (you need to try to keep them).
The third group includes expenses on increasing the efficiency of the entire company or its branches. At first glance, each of the projects is not particularly expensive, but the total amount for all the CFOs is quite large.
It is important to pay attention to the priority of projects. When crisis situations arise that require cutting management costs, the first to stop funding low-priority projects.
Step 2: Establishing responsibility measures between the CFOs
A serious step that should be taken using a functional approach. That is, to form a separate plan of centralized expenses for each of the allocated CFOs. In particular, for the HR department (money for salaries), for the administration (expenses for maintaining the office), etc.
Establishing measures of responsibility between the Central Federal Districts
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Based on the functional chinese student data package purpose of each of the divisions, a plan of expenses is formed for them for individual items (these are non-centralized expenses) and for the activities carried out by this division. You can also add a reserve expense item (and call it: "Reserve") for unplanned actions.
The best way to reflect management expenses in the balance sheet is to form them from scratch. Moreover, each department head is obliged to provide justification for their budget requirements. Explanations like “it was like that a year ago” are not considered justified. Only regular expenses remain unchanged every year, so they are not discussed here.
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Step 3: Define and adopt the planning procedure, deadlines
The principles of budget management (in other words, budgeting) are usually reflected in the budget regulations, which, as a rule, are in every organization. However, this is more likely to apply to very large, steadily developing companies.
All others issue an order (signed by the CEO), which specifies the deadlines and lists the responsible persons. Below is an example of such an order:
Responsible person/manager Prescribed duties Deadlines
Stage 1. Information collection, planning.
Responsible executive of the Central Federal District
1. Forecasting expenses in relation to the assigned Central Federal District for the 4th quarter of 2017.
2. Study of data on actual expenses for 9 months of 2017 (provided by the PEO), plus analysis of planned indicators for October-December. These documents are the starting point for making budget forecasts for 2017.
3. Collection of information on the company's divisions for 2018 with mandatory consideration of expenses on which the volume of management expenses will depend.
4. Planning the budget for the Central Federal District for 2018 (based on the collected data).
5. Submitting the budget to the head of the Central Federal District for approval.
13.10.17-24.10.17
Head of the Central Federal District
1. Analysis, approval of the budget of the Central Federal District (for which this manager is responsible), submission of the budget for review to the financial director.
2. If necessary, providing clarifications and defending the budgets of the Central Federal District before the CEO.
27.10.17
Budget Controller
1. Preparation of a report on actual expenses for each financial center for 9 months, submission for review to the heads of the financial centers.
2. Checking the budgets of the Central Federal District at the development stage for compliance with the principles of budget planning.
3. Submitting budgets of the Central Federal District to the financial director for review, drawing up a consolidated budget of management expenses.
Until 13.10.17
Stage 2. Preparation and protection
Financial Director
1. Study and approval of the submitted budgets of the Central Federal District; in case of disapproval, return for revision.
2. Support of the budget process, participation in the defense of budgets before the director.
27.10.17-07.11.17
General manager Approval of the Central Federal District budgets. 10.11.17-19.11.17
If compared with budget regulations, in practice it is more convenient to use an order. It specifies tasks for short-term periods of time, clearly specifies deadlines and responsible executors. In addition, the order is not cluttered with references to regulations, letters and other documents of local significance.