Compared with traditional financial management, what are the advantages of lean financial budget management?

Financial budget management is the most effective internal control mechanism in the business process, which plays an important role in coordinating and optimizing the resources of the enterprise, promoting the development of the enterprise in accordance with the planning, coordinating actions, and controlling the direction of business development.

Therefore, EPC believes that it is important to rationalize the budget management system, clarify the budget interface, strengthen the management budget foundation work, scientifically measure the budget quota, make the budget to achieve the generalization and synthesis of business plans and planning, and ensure that the budget carries out the enterprise's overall business strategy is quite important to the financial sector.

First, the traditional financial budget management drawbacks

1, only emphasize the budget management of the financial sector, ignoring the budget management organization

Some of these enterprises are financial budgeting and adjustment of the work done by the financial sector or the budget team, did not really do the full participation in the budget management, resulting in the lack of authority and foresight of the management of the financial budget, it is difficult to play the role of the financial budget. The role of the financial budget.

2, the enterprise only attaches importance to static management, ignoring the dynamic management

In the choice of budgeting methods, most enterprises on the business budget, capital expenditure budget and financial budgets, etc. are still using the traditional fixed budget, regular budget and other methods of compilation, the budget indicators in the implementation of the process remain unchanged, and the end of the operation of the results of the direct comparison of budget indicators. This static budgeting method is suitable for business volume fluctuations in the enterprise, and when the enterprise sales volume, prices and costs and other factors change a lot, the static budget indicators are prone to lack of flexibility, it is difficult to become an effective benchmark for the assessment.

3, the enterprise only pay attention to the management of capital utilization, ignoring the management of capital costs

Many of these enterprises are mainly based on the business budget and capital expenditure budget for the preparation of the financial budget, pay attention to the cost of the budget and investment projects, capital expenditure arrangements, while ignoring the cost of capital consumption. This not only makes the use of funds to reduce efficiency, waste of resources, and cause the capital structure is not reasonable, the cost of capital increases, financial risk increases.

4, most companies only pay attention to the analysis of internal factors, ignoring the study of the external environment

Some companies in the financial budget management process is mainly based on historical indicators and past activities, combined with the level of funds, technology and management to determine the future financial budget indicators, often ignoring the external environment of the research and forecasting, so that a lot of financial budget indicators are difficult to adapt to the external environment, more difficult to implement in the enterprise.

The first step in the development of a new approach to financial budgeting is the development of a new approach to budgeting.

Second, the advantages of lean financial budget management

1, insight into the changes in the business environment, to provide professional services.

Lean financial budget is based on operational planning. Once operations planning is complete, companies have information about expected sales, operations, improvements, and new products, and based on this information and an understanding of the costs associated with the business, companies can quickly complete their financial budgets.

Lean financial budgeting no longer emphasizes the accuracy of the budget data itself, it requires budget management must be done in detail, and the factors affecting the efficiency of the enterprise to consider all the factors, so as to be able to understand the changes in the business environment at the same time an objective evaluation of the impact on the enterprise, for business operators to make business decisions, adjust the business strategy, and to achieve the established goals to provide support and services.

2, optimize the enterprise cost structure, improve the process system

Lean financial budgeting is dynamic, can make the comprehensive budget management to achieve the standards of fine, fine, full, so as to continue to optimize the cost structure, to reduce ineffective, repeatable expenditures, and to ensure that profits continue to grow.

It can better improve the index system of comprehensive budget management and strengthen the connection between individual budgets;

It can revise the cost quota according to the actual production and improve the enforceability of the budget;

It can comprehensively analyze the intrinsic connection between the budget indexes of each unit to achieve the coordination and balance of the budgets of each unit.

For more information, please go to the public number "ePan Technology" and "Play comprehensive budget".