Budgeting is the process of creating a plan to spend your money and how you want to make money for your business. This plan lets’s you have an advance view of how your business will performance so that you can align current realities – expenses and income – to expected result.
In a situation where you don’t much cash to spend, the planning processes help you prioritize your expenses by focusing on cash-generating expenditures.
Why is Budgeting important for your business?
Since you are only working with limited resources, budgeting:
- ensures you don’t sway by unexpected expenses
- you have a benchmark upon which performance is measured with.
Steps to Build a Budget that works
You don’t have to comb through your excel or paper records to create a workable budget, there are reliable accounting software that can help you create a financial plan and do a real time comparison with actual transactions.
For instance, QuickBooks allows you to create a budget from scratch or build one from previous year actuals. Depending on whichever options you select, you can proceed to the next step by:
- Starting with what you want to spend by reviewing your expenses line items
- Projecting your sales revenue and other income sources
- Track your business performance and instill control where necessary.
For more information on how we can help you set-up QuickBooks, call 01-4542116