Ahh, budget development. It seems like it should be an easy task, doesn’t it? You develop the budget, get some feedback, make changes, and you’re done! Any financial professional will tell you it’s hardly that easy.
Budget development isn’t exactly a linear process. To get from A to B, you’ll have to make several pit stops along the way. Detours and delays are commonplace. If you feel lost in the budget cycle, you’re not alone.
However, with commitment and the right tools, you can arrive at your best budget yet. Here’s how to map your way out.
The Budget Roadmap
Why think of a budget as a roadmap? Simply put, it is a guide for your organization to follow over the course of the next fiscal year. By carefully mapping and monitoring the course, your nonprofit can stay on track toward mission delivery. You’ll also be able to use this roadmap again and again as you finetune its components.
How to Break the Budget Cycle
One of the easiest ways to find your way out of a never-ending budget development cycle is to begin with proper communication. You probably take in feedback after the first draft of the budget, and that’s certainly a great thing to do. Don’t forget to communicate with key players before the development process begins.
Make sure you find out what the predicted expenses, income, and cashflow are. Take note of any feedback on last year’s budget as well. Develop your budget planning team around your organization’s objectives, both in the short-term and long-term future.
As you plan, always give yourself a cushion. Projects often take much longer than we originally imagine. As detours arrive, you’ll be glad you gave your team more time to develop the final budget. No need to worry about scrambling to stay on task!
Finding the Right Tools
All the planning in the world is useless without the right tools. Accounting professionals need innovative, robust software by their side. Those in the nonprofit sector especially need customizable solutions to meet compliance standards.
So, what’s the right tool for planning, revising, monitoring, and tracking? Look no further than Abila’s MIP Fund Accounting™ Software. This solution is accessible, intuitive, and customizable. You’ll have the tools you need to develop and track budgets efficiently and effectively.
Abila’s MIP Fund Accounting™ Software allows you to streamline your budget cycle. With this true fund accounting solution, you’ll be able to:
- Develop budget worksheets for individual grants, programs, or account segments
- Monitor the total budget
- Set budget tolerance alerts
- Review budget progress for the development of “what-if” scenarios
- Measure financial performance against KPIs
- Access historical data
- Make budget revisions
Don’t let a never-ending budget cycle prevent you from improving your organization’s future. Regain control of the development process and make budgeting fun again! For more tips and practical advice on effective and efficient budget development, download Abila’s Building a Better Budget: A Nonprofit Budget Roadmap or contact us for more information!