...Budget Management Analysis HCS/571 Financial Resource Management June 27, 2011 Dr. Lena Watson Budget Management Analysis Budget management analysis is used by mangers as a tool and helps determine that all resources available are being used efficiently. The budgets are determined yearly and are based upon the previous year’s budget and variances. This paper will discuss specific strategies to manage budgets within forecast, compare five to seven expense results with budget expectations, describe possible reasons for variances, give strategies to keep results aligned with expectations, recommend three benchmarking techniques, and identify those that might improve budget accuracy, and justify the choices made. Strategies to Manage Budgets Many strategies may be used to control budgets; managers and the chief financial officer of most healthcare organizations have the tools needed to manage the budget. By managing the budget the organization will be better prepared for the financial forecasts, which are the company’s future expenses. Some strategies and tools that will assist with managing the budget are zero based, activity based, performance based, cost variances and benchmarking. Zero based budgeting analyzes every expense within an organization and justifies the need and cost of each. Activity based costing is the gathering of the operating cost data, which is assigned to specific activities such as engineering. The performance dashboard uses the metrics of performance...
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...Corporate strategy identifies the goals of a company and defines ways of achieving those goals. Project management takes one of the goals and manages costs, schedules and resources to give the desired result. When small businesses use projects to make progress toward their strategic goals, they have to be aware of the differences between the two processes. While both corporate strategy and project management share planning and control characteristics, the details of their implementation and execution are not the same. Goals: The goals of corporate strategy and project management are different. Those of corporate strategy define the direction of the company and are not usually time limited. A strategic goal of excellent customer service is a continuous process. A project is designed to achieve its goals within a certain time frame. Its goals are to produce the desired result within budget and according to the schedule. Once the goals are met, the project is complete. Corporate strategy may use projects to further its goals, but the projects are steps in the overall process while the corporate strategy carries on. A project is “a temporary endeavor undertaken to create a unique product, service, or result.”Operations, on the other hand, is work done in organizations to sustain the business. Projects are different from operations in that they end when their objectives have been reached or the project has been terminated. A program is “a group of related projects managed in...
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...Budget management analysis is commonly used by mangers as a tool helping to make sure that all resources in existence get put to use correctly. The budgets are determined annually because they are determined by the preceding year’s budget and differences. Budgets can be controlled by specific techniques to control budgets within prediction, consider five to seven expense results with budget anticipations, explain possible factors that cause fluctuations, present ways to keep results associated with goals, share three benchmarking strategies, and consider the ones that could increase budget accuracy, and give good reason for the choices made. (Finkler, 2007) Several techniques are often used to regulate budgets; managers as well as the chief financial officer of nearly all health related agencies provide the techniques necessary to manage the budget. By balancing the budget the institution will likely be better organized for the financial guidelines, which are the company’s upcoming expenses. A few techniques that can improve balancing the budget are zero based, activity based, performance based, cost fluctuations and benchmarking. Zero based budgeting examines each individual expense within a business and justifies the necessity and expense of each. Activity based pricing is the accumulation of the operating cost records, which is also assigned to individual programs which include engineering. The performance dashboard applies the metrics of functioning and examines the reason...
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...manager. The sponsor is continually involved, including defining the project and actively reviewing the progress. | (Name of Individual) | Responsibilities | * Ultimate authority and responsibility for the success of the project. * Communicates on behalf of the project or defers to Project Manager. * Garners commitment from other key stakeholders. * Assures availability of essential project resources. * Approves the budget and decides tolerance levels. * Authorizes and approves/rejects “Project Change Requests” issues that affect Scope, Cost, Time or Quality which are outside of tolerance levels. * Leads the project steering committee. * Facilitates organizational level problem solving and ensures escalated risks/issues are resolved. * Makes key decisions on changes, risks, conflicting objectives and any other issue that is outside of the project manager's designated authority. * Negotiates a path through complex diplomatic areas of the project. * Supports the Project Manager, provides and approves discretionary budget, and offers mentoring, coaching and leadership when dealing with business and operational matters. | Title | Role | Name | Project Manager | Responsible for leading a project from concept to close out. This includes conceptualization, initiation, planning, executing-controlling-monitoring and closing out...
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...project. The Project Manager then ensures that the project is delivered on time, to budget and to the required quality standard (within agreed specifications). He/she ensures the project is effectively resourced and manages relationships with a wide range of groups (including all project contributors). The Project Manager is also responsible for managing the work of consultants, allocating and utilising resources in an efficient manner and maintaining a co-operative, motivated and successful team. Responsibilities • • • • • • • • • • • • • • • • • • • • Managing and leading the project team. Recruiting project staff and consultants. Managing co-ordination of the partners and working groups engaged in project work. Detailed project planning and control including: Developing and maintaining a detailed project plan. Managing project deliverables in line with the project plan. Recording and managing project issues and escalating where necessary. Resolving cross-functional issues at project level. Managing project scope and change control and escalating issues where necessary. Monitoring project progress and performance. Providing status reports to the project sponsor. Managing project training within the defined budget. Liaises with, and updates progress to, project board/senior management. Managing project evaluation and dissemination activities. Managing consultancy input within the defined budget. Final approval of the design specification. Working closely with users to ensure...
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...Product Description Version 1 1. Question: (TCO A) You are the CEO for Skipper Products. The business has had a great year and you see that a PPM is needed to manage all the projects that are currently in progress, along with future projects. You must convince the board of directors to accept this change in order to implement it. You have decided to give a presentation at the next meeting that covers the information below. • What is a PPM? • Compare PPM, PgM, and Project level. • Benefits of each (PPM, PgM, and Project) • Why should Skipper Products implement a PPM? Create a detailed outline that covers all the areas listed above. 2. Question: (TCO B) There are three central processes that are required to develop a portfolio strategic plan. Describe each of them. Why are these processes important to the success of an organizations strategic plan? 3. Question: (TCO C) Cost management is used to help manage projects as investments and to evaluate project management performance using Earned Value Management (EVM). What is EVM? Describe the benefits of using EVM. 4. Question: (TCO C) The following acronyms are used in a network diagram: LS, ES, LF, and EF. What do these acronyms mean, how are they calculated, and how would a project manager use these in relationship to project schedule and budget? Version 2 1. Question: (TCO A) You work for Holt consulting company, which has been asked to recommend organizational improvements for CDC Software Company. You...
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...should contribute to make it happen. News categories: Enterprise and business strategy, Finance and accounting, Performance management and controlling, Information Technology by Juergen H. Daum Table of content: Intro Why should a company consider to move Beyond Budgeting ? How does the Beyond Budgeting model work ? Who should contribute to make it happen ? The Transition Route – Major success factors Summary Additional resources (updated Jan 2005) “Fixed budgets don’t work today. A budget is a too static instrument and locks managers into the past - Daum New! - visit J.H.D.'s Beyond Budgeting Info Center - including latest BB insight materials, interviews with BB pioneers etc. - here an extract: | J.D.'s insight article "Beyond Budgeting" | Interview with Lennart Francke, CFO of Svenska Handelsbanken | Panel Discussion with Borealis, Nestlé, and Unilever | Interview with Jeremy Hope – co-founder of the Beyond Budgeting Round Table | Interview with J.D. on finance and IT | Intro Three years ago I presented to a group of senior executives at the headquarters of a large U.S. based consumer products company with global operations the concept of “Strategic Enterprise Management” (SEM) – a concept that ties enterprise management closer to strategy and establishes management processes that make it easier to manage trade offs in the business system and to adapt strategy, operative activities, and resource utilization plans faster to changes in a company’s...
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...fiction corporation data centre is moving its primary data centre miles away by upgrading its network and correct any security flaws its infrastructure in the part of its move with a capital budget of $500,000 without interrupting business operations. . MCC helps in controlling costs, improving operational excellence and mitigating risk during device network and software refreshes with systematic, comprehensive, efficient approach on upgrading the network infrastructures.Fiction Corporation—a detailed project overview, and the identification of all stakeholders, including both Big-Proj and Fiction Corporation, as well as the 500 retail outlets. Initiating the project Project initiation is the reference that determines the scope and the process activity to solve on a problem in establishment of projects to achieve the aim and objectives representing the roles and responsibilities of the organization and its goals of customer expectations and requirements Designing the business need: Here, the initial step of business plan is considered as the most important entity as it provides a roadmap for success on a thoughtful and long term business plan. Business plan is illustrated as the description of the business future. It’s a document which predefines the projects plans and the business strategy consisting the set of resources which is based on the potential elements of business which depends on the change and growth of the business. Setting the objectives: This is the standard...
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...© The Project Management Processes PROJECT MANAGEMENT FOR DEVELOPMENT ORGANIZATIONS The Project Management Processes PROJECT MANAGEMENT FOR DEVELOPMENT ORGANIZATIONS A methodology to manage development projects for international humanitarian assistance and relief organizations © IMPACTO4DEV 2007 Our eBook is provided free of charge on the condition that it is not copied, modified, published, sold, re-branded, hired out or otherwise distributed for commercial purposes. Please give appropriate citation credit to the authors and to PM4DEV. Feel free to distribute this eBook to any one you like, including peers, managers and organizations to assist their project management activities. www.pm4dev.com The Project Management Processes PROJECT MANAGEMENT PROCESSES Project management is a process of leading a team of capable people in planning and implementing a series of related activities that need to be accomplished on a specific date with a limited budget. Because of its nature, coordinating all these activities requires a process approach. Because many times development project take on unexplored territory, assumptions about the project must be listed, evaluated, its risks assessed and contingency plans developed. It also requires a close monitoring of the budget, scope and schedule to deliver the project objectives under the expected quality. Each one of these elements needs to be managed in a systematic manner with the development of plans to identify the...
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...performance. The current appraisal and reward system is increasing this isolated and non-cooperative working of the different functional units. ▪ The sales department to improve their sales want to have high finished goods inventory ▪ The production department wants to have high inventory of raw material to have uninterrupted production schedule. They are not interested in implementation of Just-in-time inventory methods to reduce the overall cost. ▪ The current control and reporting system does not provide enough good quality data to guide management decision process. For example, no record for work in process is kept in the company. ▪ The accounts department is making the budget without getting any information from functional units. This way the budgets are not realistic and reflect only an accounting necessity rather than a decision making and control tool. ▪ The cash management system of the company is not good and company is facing the cash management problems. Validity and Reasonableness of Letsgo’s Sales Projections: Table-1: Actual and Projected Sales Growth | |Sales |% Increase | |1992 |13,765 | | |1993 |14,880 |8.10% | |1994 |15,991 |7.47%...
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...SUMMARY OF CHAPTER 9 BUDGET PREPARATION Nature of Budget Budgets are an important tool for effective short-term planning and control in organization. An Operating Budget usually covers one year and states the revenue and expenses planned for that year. It has certain characteristics like: * A budget estimates the profit potential of the business unit. * It is stated in monetary terms, although the monetary amounts may be backed by the non-monetary items like units produce and sold. * It generally covers a period of one year except the seasonal businesses. * It is a management commitment that managers agree to accept responsibility for attaining the budgeted objectives. * The budget proposal is reviewed and approved by an authority higher than the person preparing the budgets. * Once approved the budgets can be changed only under specified conditions. * Periodically, actual financial performance is compared to budget, and variances are analyzed and explained. * The budget is different from strategic planning and forecasting. Uses of Budget Preparation of an operating budget has four principal purposes. 1. Fine Tuning the Strategic Plan: * The strategic plan of the last year can help the managers in preparation of the budgets. * And budget preparation also provides an opportunity to make decisions that will improve performance before a commitment is made. 2. Coordination: * Every responsibility center manager participates...
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...Budget Management Analysis Budget management is an important concern for organizations, especially today with the economic strain on businesses. The strategies to manage budgets and possible variances will be addressed within the context of this paper. A comparison of five expense results with the budgetary expectations and reasons for possible variances will be presented. Benchmarking techniques that may improve budget accuracy in future forecasts will also be concentrated on within the body of information presented Managing a Budget within the Forecasts According to Finkler, Kovner, and Jones, (2007), organizations exercise control over operations through the use of a management control system. The determination of whether a business is able to appropriately budget for future expenses, economic downturns, and risks is critical in today’s economic crisis. The methods by which a budget is created are specific and take into consideration several factors that provide target, actual, and variance results. The strategies used to create a budget vary among industry, organization, department, and/or manager just to name a few. Budget variances, strategies, and benchmarking techniques are critical to the final budget formulated for a business. A budget is a way to assist managers to follow a set strategic plan to ensure resources are used to efficiently to achieve the goals and follow the mission of the organization. A budget provides estimates of revenue, expenditures...
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...the relationship between management accounting and planning profiles in Brazilian companies. The main goal is to understand the consequences of not including a fully structured management accounting scheme in the planning process. The authors conducted a field research among medium and large-sized companies, using a probabilistic sample from a population of 2281 companies. Using analytic hierarchy process (AHP) and statistical cluster analysis, the authors grouped the entities' strategic budget planning processes into five profiles, after which the authors applied statistical tests to assess the five clusters. The study concludes that poor or fully implemented strategic and budget-planning processes relate to the management accounting profiles of the Brazilian organizations studied. © 2009 Published by Elsevier Inc. Article history: Received 1 March 2009 Received in revised form 1 September 2009 Accepted 1 November 2009 Available online xxxx Keywords: Management accounting Strategic planning Budget 1. Introduction The business environment has become increasingly volatile and unpredictable in recent decades, and business management has become correspondingly more complex. In particular,...
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...Bank? Management Principles and Dynamics I. Statement of the Problem What control strategy is appropriate with Barings Bank situation? II. Objectives Find the right control strategy model for Barings Bank to prevent another mismanagement of the bank. III. Areas of considerations/Assumptions A. Areas of considerations a. Corporate culture b. Financial c. Decision-Making d. Leadership / management e. External/Internal environment B. Assumptions a. The Bank’s top officials gives a free-hand to Mr. Leeson to manage the affairs of their Singapore branch b. Mr. Leeson is a great manipulator. c. Top Officials of Barings Bank knows the real situation (financial) in their Singapore branch d. Mr. Leeson gives a lot of money to Baring’s Top Official. IV. Theoretical Framework Financial Control Management of Financial performance that measures the following: a. Liquidity b. Leverage c. Asset management d. Profitability Financial ratios are ratios are useful for historical comparisons within barings banking firm and for external benchmarking. Financial budgets or goals are to be shared with employees and tracked to indicate success or failure in their accomplishment...
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...Nokia to capture and share experiences, access information, find their way or simply to speak to one another. Nokia's technological and design innovations have made its brand one of the most recognized in the world. For more information, visit http://www.nokia.com/about-nokia. General Function Manage the internal and external communications function in Vietnam based in Ho Chi Minh. Co-ordinate and implement all communications activities in country. Reports directly to General Manager, Sales & Marketing, Head of Communications, APAC. Main Responsibility Areas Creates communications plan for the country, key messages, positioning materials, collaterals & media events and executes the plan. Advisor to Nokia Vietnam’s management in topics that have an impact on Nokia’s reputation Creates local materials for locally relevant media activities Localises and distributes international media releases, materials Support in Nokia’s key stakeholder relations (operators, customers, partners, developers, industry associations) Media Relations Develop and implement the full media relations strategy for Nokia in Vietnam Develop and be responsible for all aspects of media coverage. Manage the perceptions of the business by the media and public Acts the spokesperson for Nokia Organise interviews for other approved Nokia spokespeople. Foster strong useful relationships with key media contacts. Select, invite and host media on to Nokia overseas events. Proactively build and maintain...
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