Finance trainingFinance for non finance – why is accurate budgeting important?

Lots of reasons.

1. Accurate forecasting in budgets means you know what’s going on. You understand your environment; team, division, organisation, country, so well that you are able to accurate forecast your budgetary needs.

2. Accurate budgeting means you don’t give anyone any surprises, and people like predictability.

3. Trust – it means your manager, directors, or investors can trust what you said would happen, happened.

4. If we’re not accurate, what went wrong? If we didn’t spend enough, why not? Surely that money needed to be spent. If we spent too much, how come? What surprised us?

5. Accuracy means you understand your business.

And there are probably lots of other reasons bedsides these. There is a very strong case for accurate budgeting. If you say you’ll spend x on your plan, then spend it. Don’t fall in to the trap that many managers do, in that not spending it is good, right? Wrong, for all the above reasons and more.

Finance for non finance – why is accurate budgeting important?