Tips For Implementing Budgeting and Reporting System

3 min read
Jul 22, 2020 5:45:00 AM

Implementing any new software solution can be a challenge. Some sales demonstrations can show an ideal nirvana with simplistic demonstration databases and fancy graphics. But when it comes to the nuts and  bolts of actually building and implementing your own models it could be way more complex they you originally believed.

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We offer and recommend to companies interested in Corporate Planner that they can have a proof of concept demonstration. A proof of concept demonstration of a budgeting a reporting system can help both yourself and ourselves.

  1. We talk the same jargon from the start.
  2. You can see your structures and data in the system. Giving confidence it will deliver your requirements
  3. We can add our own suggestions from other processes we have encountered with other companies.
  4. We can more accurately advise on implementation time and problems you might encounter.

Budgeting and Reporting Requirements

When implementing a new budgeting and reporting system the first key questions are around the outputs. To measure the success of implementation, we first need to set out the targets the system has to achieve

  1. What data is currently reported upon and required?
  2. What is the frequency of the reporting periods?
  3. Who needs access to reports and enter budgets/forecasts?
  4. What additional information would add value to my business process?
  5. What are your current spreadsheet / other solutions you need to replace?
  6. Are there any additional models you would like the system to replace?

Where is my Source Data?

Now the key outputs have been defined the next key questions are around source data.

  1. What is/are my finance systems?
  2. Do I have more than one chart of accounts? Do I need a group chart?
  3.  What other data needs to be incorporated into the budget and reporting process?

Creating the Budget and Reporting Model

One of the most common attitudes when implementing a budgeting system is. This is my current spreadsheet budget model, please replicate it identically.

This approach whilst keeping the process identical, does not allow for new design and thinking. The existing process may be very old and not focus on the key drivers of the business. In the worst case it could lead to a poor model being replicated without the aimed efficiency improvements of implementing a corporate performance management solution.

We would recommend a review of the existing models to ensure the best model is built into the planning system. Some key questions to ask when designing the budgeting model and process are:

  1. What are the key business drivers?
  2. Which parts of the plan are user defined / formulae derived?
  3. Who is responsible for each part of the business plan?
  4. How do different parts of the business plan integrate together?
  5. When should different parts of the budget and forecast be reviewed?

Creating Reports

Once the model is built reports need to be set up to quickly communicate key management information to users. Creating a unified reporting format will help when reviewing data across the business. Some important things to consider when creating reports are:

  1. Say – What is the key message of your report. By presenting a clear message recipients are immediately drawn to the message rather than having to hunt for it.
  2. Simplify – many reports have far too much unnecessary clutter, frames, backgrounds, these often distract from the message and stop the key information being presented on one side.
  3. Express – choose the correct analysis for the format of data.
  4. Check – Report is properly and consistently scaled, formats are consistent with other reports.

Big Bang or Phased Implementation?

Business looking to improve their financial planning and reporting process will often have a number of different planning models and processes to replace these often include:

  • Integrated Financial Planning
  • Financial Consolidation
  • Sales Reporting and Forecasting
  • COS Planing
  • Staff Planning
  • Production Planning

Whilst it is a nice idea to replace all models in one big-bang implementation. There are often many disadvantages including staff availability, greater initial stakeholders, and implementation costs. Businesses find a phased implementation is more successful it is often best to focus on the first key priority of the business implement that and expand the use of the system once each part of the project is complete. A phased implementation often ensures that the system is live and reaches a ROI point faster.

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