Ramargha
Service

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I am working as a manager accounts and our company recent assignned budget planning job to me but my prob is that I am not well verse with this .
so requested to please advise in this rgds that how this is to be started from initial stages to reporting stages.

Hi,This is quite a complicated task. Budget planning is a plan for the year ahead.You need to consider the sales forecast for the year. Based on that go one step back, i.e. Production. You need to forecast raw materials purchase, stock in hand, etc.Divide the cost into fixed, variable & semi-variable.That will help you to plan more correctly as you dn't have to scratch your head to much on fixed cost like rent, insurance etc.You have to break the variable & semi into tiny particles.I would sugget you to work out on monthly basis .You have to cover all costs, like admin overhed, sales overhead, production overhead etc.Always refer the previous year costs as the base.With inflation , going above 11%, and there is no respite in sight in near term, you have to create a provision for that too in the budget.But a big question remains is whether it is possible to increase sales price as well. If not, margin is bound to suffer.I hope this will help you!!!!!RegardsArgha
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