Course Methodology

The course is a hands-on application on how to use MS Excel in budgeting and forecasting. Participants will be involved in exercises, individual and group presentations, and will work on several case studies.

Course Objectives

By the end of the course, participants will be able to:

• Evaluate the financial impact on their organization's strategies and plans
• Build effective budgets for their departments or organizations
• Apply several forecasting techniques to manage uncertainties in budgeting better
• Assess capital budgeting decisions using several methods and recommend proper action
• Utilize Microsoft Excel functions and tools in the budgeting process, including breakeven analysis and optimization

Target Audience

Finance directors, managers, controllers, accountants, budget analysts, budget owners and professionals who wish to expand their budgeting knowledge.

Target Competencies

• Budgeting
• Forecasting
• Evaluating proposals
• Applying Microsoft Excel functions and tools
• Assessing budgeting process

Budgeting and Planning

• Strategy development framework
• The three horizons of growth model
• Strategic budgeting and resource allocation
• Growth-share matrix
• Nine-box matrix
• Budgets and the key financial statements

Budget cycle, process, and approaches

• The budget cycle
• Characteristics of successful budgeting
• Making the budget a value-adding activity
• Top ten problems with budgeting
• Choosing the proper budgeting approach:
• Incremental budgeting
• Zero-based budgeting
• Flexible budgeting
• Kaizen budgeting
• Activity-based budgeting
• Rolling (continuous) budgets and forecasts
• The master budget and its components
• Operating and capital budgets
• Best practices in budgeting

Forecasting Techniques

• Forecasting models
• Qualitative and quantitative methods
• Steps in developing forecasting models
• Time series and trend analysis
• Data conditioning techniques
• Exponential smoothing and moving averages
• Simple and multiple regression analysis
• Forecasting components of financial statements

Advanced Capital Budgeting Evaluation Techniques

• Business risk and cost of capital
• Classifying investment projects
• Cash flow estimation
• Analyzing investment and operating cash flows
• The time value of money concept
• The required rate of return
• Net Present Value (NPV)
• Internal Rate of Return (IRR)
• Multiple internal rates of return
• Modified Internal Rate of Return (MIRR)
• Profitability Index (PI)
• Payback period and discounted payback period
• Capital rationing
• Comparing and evaluating techniques
• Sensitivity and risk analysis

Breakeven Analysis and Optimization Techniques

• Cost Volume Profit (CVP) analysis
• Using CVP to reach a target income
• Single product and multiple products breakeven analysis
• Working with budget constraints
• Building optimization models