Budgeting and forecasting software is a tool to help Finance Staff to prepare their financial budgets and forecasts in a systematic and easy way. Budgeting and forecasting software does not improve your accuracy as some may thought. However they could help to cross link or pull numbers from various parts of your budgets or forecasts which enhances the accuracy level.
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There are many major financial numbers repeated in several pages of your budgets or forecasts. For example, the sales numbers appeared in your Sales, Income, Cashflow and Trade Receivables Budgets. Like wise the capital expenditure numbers appeared in your Capital Expenditure, Expense and Cashflow budgets.
The manual budgeting and forecasting process is long and tedious process. The preparation works can take more than two months in big corporations. It will be more complicated if the corporation has multi branches or subsidiaries. The situation becomes more complex if it has several subsidiaries operating in several countries.
If you ask any Finance Staff, they will tell you that budgeting and forecasting process is never an easy task. It usually comes with tight deadlines and many changes especially toward the finalising phrase. Every bosses are similar. They want to show super results in their budgets and at the same time be achievable. It is not easy to match super budget with achievable targets. As a result, they make changes after changes on the numbers during the finalising phrase. In certain cases, they drew up a scenarios in their budgets. For example, the Finance Staff are requested to prepare the budget in three scenarios such prudent, average and aggressive. In the event that they make changes, the Finance Staff got to ensure that all the three scenarios are updated accurately. The amount of manual works and processes involved are voluminous and usually very tight deadline is given.
The main objective of a budgeting and forecasting software is to automate the process of preparing and cross reference similar numbers from various pages to improve timeliness and accuracy. Most software is designed by experienced Budgeting Experts. Using the software would make the preparation works more systematically and easier. The software offers easy and user friendly ways of making amendments and the changes can be reflected in all related parts or pages just with one click.
Many big corporations and Finance Staff are investing in budgeting and forecasting software. It does not mean that the Finance Staff are incapable. In fact it is the opposite. An efficient Finance Staff should knows how to make use of the latest technology to improve and produce a good piece of work. Therefore his knowledge must improve with current technology and his work must be completed in the fastest and most accurate way.
