BUDGETING AND FORECASTING
Your bookkeeper and accountant are great at recording day-to-day transactions and keeping you compliant with the tax office – but they are maybe not great at helping you set a path for the future.
Financial Controlling @ Anconsult is different because our services are designed to help you create a strong, healthy business. To achieve your goals, you need a solid financial plan.
Why Budget and Forecast?
Peace of mind
Budgeting is often considered a dirty word by business owners and entrepreneurs who believe that budgets limit or restrict them and their business.
However, this is not the case. Budgeting and forecasting is an important key to keeping control of your finances so you can maintain the health of your business while you grow. It keeps you on track and accounts for the unexpected.
For example, imagine that your commercial oven breaks down on a Saturday just before you have to cater for 200 people. The call-out fee and Saturday loading alone might blow your profit for the month.
However, if you have money set aside for this, you can call a mechanic, get it fixed and get on with the job without worrying about anything.
Provisions for the future
Budgets can also help you declare provisions for expenses at the end of the financial year.
In plain English, this means that if you had a good year with no major issues, you could declare some of the expenses that you expect in the following year as provision*.
Using the caterer example, you would expect your equipment to break down at some point. So why not split the expenses between the two years and offset your income with it? That way, you reduce your profit and pay less tax this year and can set untaxed money aside for an equipment breakdown the following year.
* This is an example only. Contact your tax agent for tax advice about your specific situation.
Securing your profit
The best part of a budget is that you have a better idea of your profit.
This means you don’t have to wait for a profit and loss statement to know how much money you can take out of your business, as long as you stick to the budget.
Being prepared, through budgeting and forecasting, will help you keep your business healthy.
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