Budgeting, Forecasting and the Planning Process

5 Day Training

Dates: 24 – 28 February 2025
Locations: Grayston Ridge Office Park, Sandton
Platform: Available In-Class / Online

Price: Available on Request

Course Introduction

Prospen Africa’s training course on Budgeting, Forecasting, and the Planning Process provides participants with the essential theoretical foundation and practical skills needed to develop top-tier strategic planning, forecasting, and budgeting processes. A strategy outlines a long-term plan detailing how an organization intends to achieve its overarching goals. This course equips delegates with the tools to create a framework that aligns strategies with annual budgets and targets, aiming for exceptional management and organizational performance.

A budget translates an organization’s strategic plan into quantifiable short-term operational activities. This course teaches participants the skills and techniques necessary to develop budgets as plans, utilize control budgets, and analyse variances to identify areas for improving financial performance.

Course Objectives

By the end of this Budgeting, Forecasting and the Planning Process course, participants will be able to:

Enhance their strategic thinking and integrate the organization’s strategic management and budgeting processes.
Employ forecasting techniques best suited to their organization’s planning and budgeting needs.
Apply key financial management principles, including shareholder wealth maximization, cash flow, time value of money, and risk management.
Understand cost behaviours and determine the most suitable costing methods for financial planning, budgeting, and control.
Implement best practices to create operating budgets, capital expenditure budgets, and cash flow budgets and forecasts that align with organizational strategic objectives.

Who should attend?

This Budgeting, Forecasting and the Planning Process course is ideal for anyone involved in budgeting and planning within companies, corporations, and governmental, educational, and health service organizations. It is also beneficial for finance and accounting professionals, costing and treasury departments, and non-financial professionals with budget responsibilities or involvement in the planning process, such as:

Line Managers
Project Managers
Professional Advisers and Consultants looking to enhance their strategic thinking, decision-making skills, and expertise in planning, forecasting, and budgeting.

Training Methodology

Our diverse instructional approaches ensure effective learning:

– Lectures & Presentations: Engage with expert-driven, stimulating content.
– Course Material: Access well-crafted supporting resources.
– Group Work: Collaborate on discussions and case studies for practical insights.
– Workshops & Role-Play: Participate in immersive, scenario-based activities.
– Practical Application: Focus on applying theoretical knowledge in real situations.
– Post-Training Support: Receive extensive support after training for skill implementation.

Training Outline

Day 1: Strategic Management and Financing

Strategic Analysis, Strategic choices and evaluation, and Strategic implementation
The Links between Strategy, Forecasting, Planning, Budgeting, Performance Measurement
Strategic capability and avoiding the Spiral of Death
Shareholder Wealth maximization, Corporate and Shareholder value creation
Financial Strategy, Dividend Policy, the Agency Problem and Corporate Governance
Long-term Financing
- Debt and Equity; Cost of Equity using Dividend Growth and Capital Asset Pricing Model (CAPM); Cost of Debt; Weighted Average Cost of Capital (WACC)
Capital Structure Optimization Models to minimize WACC
Using Strategy Maps to link strategies to Performance Measurement: The Balanced Scorecard

Day 2: Financial Planning, Forecasting, and Risk Analysis

The Financial Planning Process and Modeling using Excel
Statistical Forecasting Tools and Techniques
- Time series; moving averages; exponential smoothing; Pareto Analysis; trend progression; linear regression; correlation
Forecasting long- and short-term sales revenues, and sales pricing
- Porter’s generic strategy of cost leadership and differentiation; Bowman’s strategy clock; full cost pricing; marginal cost pricing; target cost pricing; life-cycle costing; kaizen costing; value-based pricing
Using Excel for Optimum Product mix decisions
Short-term Financing, Working Capital, and the Cash Operating Cycle
Direct and Indirect Cash Flow Analysis and Cash Flow Forecasting using Excel
Uncertainty and Risk
- Business Risk
- Financial Risk
- Systematic Risk
- Unsystematic Risk
The Choices available to minimize and mitigate risk

Day 3: Cost Analysis Techniques

Cost Behavior and Activities
Fixed and Variable Costs, Direct and Indirect Costs
Product Costs and Period Costs
Cost Allocation and Absorption of Overheads
Absorption or Full Costing
Marginal Costing
Cost-Volume-Profit (CVP) and ‘what-if’ analysis using Excel
Activity Based Costing (ABC) and Activity Based Management (ABM)

Day 4: Budgeting, Budgetary Control and Performance Improvement

To Budget or Not – Purposes and Reasons for Budgets
Stages in the Budget Preparation Process
Preparation of the Master Budget
Activity Based Budgeting (ABB)
Responsibility Accounting and Variance Analysis
- Standard costing; flexed budgets; budgetary control to measure organizational and management performance
Advantages, Disadvantages and Behavioral Aspects of Budgeting
The Conflict between Performance Improvement and the Costing System
Lean thinking and integrating continuous performance improvement into the Budget Process

Day 5: Project Appraisal and Capital Budgeting

The Time Value of Money
Future Values
Present Values
Discounted Cash Flow (DCF)
Capital investment Project Appraisal
Accounting Rate of Return (ARR); payback; Net Present Value (NPV); Internal Rate of Return (IRR); Modified Internal Rate of Return (MIRR); Discounted Payback; Equivalent Annual Cost (EAC)
Project Risk
Sensitivity Analysis; simulation; scenario analysis; NPV break-even
Capital Rationing
Capital Budgeting and the Profitability Index (PI)