6.1 KiB
Finance
| Key Objective | Target | Achieved |
|---|---|---|
| Create annual budget | Get budget approved | YES |
| Correct financial figures | Pass annual audit | YES |
Budgeting
The budgeting for the organization is done once a year and involves the cooperation of various departments to create a comprehensive budget with a solid basis for the included assumptions.
Approval
Deadline
The deadline for the handover of the budget by the finance department to the management is December 15th. (R1)
Responsibilities
The approval of the budget is handled by the management and should be done until the start of the next fiscal year. (R2)
If amendments need to be made the management may approve a preliminary budget until the actual budget is finalized and approved (R3). Examples for a preliminary budget could be the approval to work according to the budget for the first month but adjust the budget for the remaining 11 months. Another solution could be to work according to the budget of the previous year until the new budget got adjusted. The decision how the interim period until the budget is corrected and approved should be handled based on the decision of the management.
The tasks and responsibilities can be found in the Budgeting Checklist. The checklist must be signed by every responsible person after completing the defined task. The CFO must ensure the checklist is filled out properly and the tasks in the checklist are taken care of. (R4)
Forecast
The basis of many figures and KPIs for the budgeted periods is the current fiscal year. For this reason the current fiscal year must be forecasted during the budgeting process. Information regarding the forecast should be collected in a similar way as for the budget figures.
Contents
The budget must be created on a monthly basis (R5). During the budgeting process it may be helpful to only budget the full fiscal year and then split the total budget up into 12 months. While doing so variations in different months should be considered (e.g. audit fees in specific months, seasonal sales distribution, ...).
Sales
Sales must contain the following information:
- Sales per product group
- Sales per country
- Sales per sales rep
Gross profit margins
For the budget the gross profit margins per product group must be used. A total average gross profit margin is not allowed.
OPEX
Operating expenses must contain the following information:
- Costs per account
- Costs per cost center
- In some cases costs per cost object
Information requested from all departments
The following budget positions must be budgeted from the respective head of the department (R6):
- Employee trainings
- Investments
- Employee changes (e.g. new position, ...)
- Other information important for the budget
Additional, department specific information are collected as described below.
HR
The HR budget must contain the budget for every employee and all replacements as well as new budgeted positions. The HR budget should also be done per salary type. This also allows to accumulate the HR budget per department/cost center and compare changes with previous years.
Planned salary increases should be already included in the budget (e.g. individual salary increases, general inflation increases, performance related increases, ...).
The following general adjustments should be included in the total budget:
- Staff turnover and delay for filling vacant positions
- Unplanned salary adjustments (e.g. work time reduction, overtime, wage compensation i.e. from insurances, ...)
Marketing
The marketing budget must contain the budget for the different marketing types:
- Print media
- Online media
- Trade fairs
- Social media
Investments
Depreciations
Depreciations are calculated based on the existing assets and their depreciation amounts/lifetime as well as the depreciation amounts and lifetime of new investments. Small new investments don't have to be calculated individually but can be calculated in a compounded position if they have the same lifetime (i.e. all PCs, laptops, printer, ... together).
Cash
Interests
Taxes
The taxes should be estimated based on the EBIT and the local tax rate. Corrections regarding deductible and non-deductible expenses should be included as well.
Monthly closing
Deadline
The deadline is the 5th work day of the following month.
Responsibilities
The tasks and responsibilities can be found in the Monthly Closing Checklist. The checklist must be signed by every responsible person after completing the defined task. (R7)
Annual closing
Deadline
The deadline is the 5th work day of the new fiscal year.
Responsibilities
The tasks and responsibilities can be found in the Monthly Closing Checklist and additionally the Annual Closing Checklist. The checklists must be signed by every responsible person after completing the defined task. (R8)
Annual financial audit
Deadline
The deadline for the audit preparation is 3 days before the audit takes place.
Responsibilities
The tasks and responsibilities can be found in the Annual Audit Checklist. The checklist must be signed by every responsible person after completing the defined task. (R9)
Reporting
The reporting for the organization is done once a month and shared with different employees depending on authorities and responsibilities.
Deadline
The deadline is the 5th work day of the following month.
Contents
Responsibilities
The tasks and responsibilities can be found in the Monthly Reporting Checklist. The checklist must be signed by every responsible person after completing the defined task. (R10)
2022-01-01 - Version 1.0