The monitoring system above financial streams

The majority of the large companies not by hearsay know, that such budgeting. However when business reaches the control of execution of the budget and its analysis, the majority of firms collides with set of questions: how to carry out the control, who should do it how to estimate the arisen deviations.

In a basis of the concept of the budgetary control two concepts lay: the plan and the fact. The purpose of the control and the analysis of execution of scheduled budgetary parameters - management of the deviations influencing financial results. During the control the budgetary controller, first, collects, processes and analyzes the information on actual results of financial and economic activity. Secondly, reveals deviations from scheduled values and analyzes their reasons. Thirdly, makes administrative decisions on updating plans and budgets in admissible cases.

To carry out these functions, it is important to adjust the effective monitoring system.

The checked up methods

In the company the set of a various quality monitoring of the budget can be realized. Many of them are highly specialized and are complex enough (for example, a method of " the mastered volume " for an estimation of execution of the budget of the project). We shall stop on two standard ways:

— The control of budgets over deviations;

— The operative control of payments (the exchequer control).

The budget of the company represents a financial plan of action on achievement of a level of profitableness. Therefore a basis of the monitoring system should be the control of expenses. For its realization calculation of deviations, during which is used:

— Reveal deviations on the basis of data of the administrative account (if uniformity scheduled and the fact sheet is provided);

— Estimate deviations from the point of view of influence on the planned result;

— Define character of deviations (for example, regular or casual) and their reasons which can be both internal, and connected with unforeseen changes of external conditions;

— Prepare recommendations and possible administrative decisions on the basis of the analysis of deviations.

These functions, as a rule, carry out financial and economic services: an economical department, or a department of budgetary planning (depending on organizational structure of the enterprise).

To reveal deviations, experts of financial and economic service постатейно compare actual and scheduled data. And to estimate influence of deviations on the planned result, they use calculation of relative density of separate clauses. On an example (see the table) calculation of deviations of actual sizes from scheduled is presented: under revenues (realization on the goods) is used the formula "fact" — "plan", under items of expenditure — the formula "plan" — "fact".

We see, that the company has received much less profits, than has been planned. To define influence on this deviation profitable and items of expenditure, it is necessary to calculate relative density under the formula: (" A deviation under clause " / " a deviation on profit ") х 100 %

The control of deviations over the nature is "the control over the fact of the come to pass operation". It is not capable to prevent an isolated fact of financial and economic activity which leads to adverse change. But it is effective on the long budgetary periods if it is spent on a regular basis. That is, supervising the deviations arising in monthly budgets, it is possible to have time to make the administrative decision and выравнить parameters on a year. For example, the company on results of nine months

Estimation of deviations and the analysis

Before leading the analysis of deviations of items in the budget or parameters, it is necessary to define, what deviations, first of all, are important. For example, for the company there is no need to make the analysis of a deviation of such parameter as the exchange rate is an environment which is not operated by the enterprise. And, on the contrary, parameters "the industrial cost price" or "the cost price of realization of production" can be operated. For this purpose it is enough to define structure of the cost price. Further it is necessary to define a limit

As a rule, it establish in percentage terms to the planned size. The size of the given deviations can reach 10 percent, but on the average varies at a level of three-five percent. Definition of a limit is enough value judgment. As a rule, the companies are guided by relative density of given clause. If relative density of clause "Wages" makes 30 percent from all expenses planning will be more exact and the limit of maximum deviations will make 0,5-1 percent.

The control of execution of budgets and the analysis usually carry out economical services. For the analysis of execution of the budget use such kinds of the analysis, as ranging, the factorial analysis, "plan-fact" the analysis and other.

Ranging is applied in that case when it is necessary to lead the comparative analysis of the functional centres of the responsibility, business-units, branches and т. Item under clauses of the budget. Thus the most profitable and-or most unprofitable divisions or directions of activity come to light. For example, ranging is effectively applied, when budgets of sales on branches are compared.

The factorial analysis is intended to reveal the factors which have affected change of values of analyzed items in the budget or parameters. At this kind of the analysis it is possible to define, for example, influence of each of branches for a total sum of realization of the goods and services. The essence of the factorial analysis is reduced defining the reason of deviations of parameters and to develop recommendations on their elimination. Above we have considered an example of revealing of deviations from the planned result.

The plan-fact the analysis can be spent both for all cores, and for separate operational budgets. Its basic purpose — to reveal the reasons of deviations, namely — what of parameters, items in the budget, сценарных conditions have affected execution of the budget of the company.

The exchequer control

Essential component of the monitoring system — the control of exchequer execution of the budget. That is the control of receipt and an expenditure of money resources which are planned in the budget of movement of money resources.

The operative control of the budget of movement of money resources is carried out, as a rule, by the budgetary controller. It, being guided by the approved limits of money resources, defines clauses of the budget for financing super planned costs. The financial controller estimates each acting application for realization of calculations and finds out, whether it exceeds a limit under corresponding clause of the budget. Excess of limits in the budgetary period can be supposed only under the special order of the representative.

The exchequer control is very often applied in holdings where the operating company disposes of money resources of branches. Branches only initiate payment, and a finance administration head the companies compares its sum to the data incorporated in the budget. And after that makes a decision on payment.