How To Build A Comprehensive Budget Control System

　　 One, three budget structures, a comprehensive budget system.

Comprehensive budget control is a self-contained and relatively perfect management mode, which is generally divided into: operation budget, capital budget and financial budget. The business budget, also known as the business budget, is a digital prediction analysis based on the profit statement of sales (business) revenue, cost, profit, cost and so on. Capital budgeting is a digital prediction analysis made around the enterprise's investment in foreign investment, capital construction projects and fixed assets purchase in the budget period. The financial budget is based on the budget and capital budgeting, and makes a digitalized prediction of the asset liability, profit realization and capital flow in the budget period, especially the capital flow budget, which is related to the capital flow, flow direction and stock situation of the enterprise, and directly affects the continuity and risk of the business operation.

　 Two, planning and control -- the core of budget management

Planning and control are the core functions of budget management.

The planning function of the budget is to decompose the overall objectives in accordance with the process of "enterprise strategy business planning - business plan and comprehensive budget" and carry out appropriate resource allocation process accordingly.

The budget control function refers to the daily execution, responsibility control and reporting activities of budget management. Budget management requires timely monitoring of the business activities of the budget responsibility center, periodically comparing the actual results and the planned target differences, and investigating the causes, feedback the difference information to the responsibility center and promoting corrective action.

　　 Three, comprehensive Budgetary control Organizational structure

In order to effectively promote the overall budget management, we should establish a corresponding budget management organizational system, which should not only adapt to the business characteristics and management mode of enterprises, but also maintain sufficient independence. Institutional settings include budgetary decision making and leading bodies, budgetary standing management agencies, and budget executing agencies.

1. Budgetary decision and management organization

The group set up the budget management committee as the budget decision and management organization, which is composed of the chairman, President, chief financial officer and general manager of each subsidiary, and is responsible for the overall budget decision of the group. Specific duties include:

According to the group's strategic objectives and medium and long-term plans, the subsidiary's annual business objectives are determined.

Reviewing and revising the comprehensive budget management method of the group;

Review and approve the budgeting and budget performance reports of various departments and subsidiaries of the group.

The budget performance appraisal system and incentive policies should be determined to meet the rewards and punishments of various departments and subsidiaries of the group headquarters.

According to the implementation of a certain period (such as half a year) or the need for major changes in internal and external situations, the budget should be appropriately adjusted and revised.

2. Permanent budget management organization

The establishment of the "budget standing working group" is the permanent management organization of the budget, headed by the chief financial officer, composed of the group headquarters and the financial managers of the subsidiaries, responsible for the compilation, guidance, review, balance and internal coordination of the overall budgets of the group and the company.

Draw up comprehensive budget management measures, budget preparation instructions and other documents, and set up budget form system;

Prepare the financial budget of the group and subsidiaries; assist the departments and subsidiaries of the group to prepare business budgets;

Summarize, review and balance the preliminary budgets of various departments and subsidiaries of the group headquarters, and coordinate the handling of budgetary contradictions and differences.

Responsible for the budget management of capital monitoring, analysis of the causes of budget discrepancy, regular reporting of budget implementation;

In the event of major changes in budget adjustment, it is responsible for timely reporting to the budget management committee and putting forward the adjustment plan.

Responsible for providing budgetary performance data and forming preliminary budget performance evaluation reports of various departments and subsidiaries of the group.

Responsible for the guidance, supervision and service work of budget management of various departments and subsidiaries of the group.

3. Budget executive body

After the budget is approved, the budgetary responsibility centers are decomposed and issued. The headquarters and subsidiary departments of the group are the budgetary units of responsibility, as well as the budget execution units. According to the corresponding budgetary responsibilities, each responsible unit shall undertake the execution functions of various budgets, such as business budgets, cost budgets and capital budgets, respectively. In order to facilitate the budget execution, the group headquarters and subsidiary departments have a part-time budget manager, and the business department is directly run by the Department Manager. The budget manager of the management department should report directly to the department heads. Specific duties:

According to the requirements of the budgetary documents, we will decompose the indicators according to departmental objectives and annual business plans, and preliminarily compile business budgets or revise them so as to coordinate and handle budgetary contradictions and differences within the Department.

According to the rights and responsibilities of the final budget, the implementation of all kinds of budgets such as business, expenses and funds;

Record the execution information of the Department's business budget and cost budget, take charge of the timely management and control of the Department's budget, and regularly check the information with the finance department.

　　 Two way operation mode of budgeting

First, from top to bottom budgeting.

The so-called top-down budgeting process is based on the group governance structure and hierarchy of rights, according to the parent company board of directors, parent company operators, budget management committee to the various levels of budget execution organization or responsibility center, until the specific post personnel order in the process of budgeting.

Step 1, the board of directors of the parent company, based on the resolution of the shareholders' meeting of the company, concludes the average rate of return on capital in the contract industry and the strategic development plan and the phased management objective of the group, puts forward the basic budgetary target for the parent company's budget year, especially the target of the rate of return on capital. The standard of assessment and reward and punishment for the completion effect of company managers is also set up, and the basic policy of budget management is put forward at the same time.

Step two, according to the requirements of the board of directors, combined with the group's development strategy objectives, resource quality and matching degree and market competition needs, the parent company's operator put forward the basic task of completing the target of the board of directors of the parent company in the budget year and the target value that should be achieved.

Step three, the budget management committee's basic tasks and the target values that should be achieved according to the budget year proposed by the board of directors and managers of the parent company. The resource conditions of the comprehensive group are formulated, and the annual budget (Draft) of the enterprise group is drawn up. According to the organizational structure or responsibility level of the budget organization, the main tasks and responsibilities objectives are put forward to each middle level budget execution organization.

Step four, the middle-level budget execution organization carries out feasibility demonstration on the responsibilities of the budget management committee in terms of the controllable economic resources and its potential within the scope of this responsibility. If new investment projects need to be demonstrated by financial and technological departments, and further decomposes the responsibility objectives to the subordinate grass-roots budget execution organizations, and determines the corresponding reward and punishment assessment standards.

Step five, the grass-roots budget implementation organization receives the tasks and targets that are decomposed, and demonstrates and decomposes them according to the same procedure as the middle level organizations, until it is implemented to the workshop, workshops, classes and individuals, and at the same time, the corresponding assessment indicators are determined.

Step six, the parent company's operator and the budget management committee convene the general meeting of the main leaders of the middle-level budget execution organization, or separately with the heads of the middle-level budget execution organizations, and carry out thematic argumentation on their tasks and objectives by way of consultation or coercion.

Step seven, when the group budget objectives and the various levels of responsibility objectives are passed or basically passed, the parent company's board of directors or managers will fully authorize the budget management committee to compile a formal Enterprise Group Budget and responsibility budget. After the approval of the parent company's board of directors, the budget executive organization of each level will be formally implemented.

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　　 Two. Bottom-up budgeting

The bottom-up budgeting process corresponds to the top-down budgeting procedure, which is a process of budgeting against the group governance structure and the rank of power and responsibility.

First, the grass-roots budget execution organization, based on the guiding principles of budget management policies and budgeting formulated by the board of directors of the parent company, the operator and the budget management committee, as well as the contents and time requirements of the various levels of responsibility budget, and based on the scope and situation of its own business, and on the basis of holding the subordinate responsibility unit and the general staff meeting, puts forward the task targets and supporting reasons that can be completed by itself, and submits the budget execution organization in the middle level (or the upper level of the grass-roots level) in written form.

Step two, the middle-level budget execution organization is based on the tasks that can be completed by the subordinate level or the grass-roots budget executive organization. Combined with the actual situation of this responsibility level, we summarize the task targets that can be completed at the responsibility level, and submit the group budget management committee together with the support reasons and feasibility analysis of the investment projects (usually by the financial department and the technical department, etc.).

Step three, the Budget Management Committee receives the tasks and supporting reasons that can be fulfilled by the middle-level budget execution organizations. According to the requirements of the board's capital return rate and the overall resource status of the group's resources, the overall environmental situation, especially the competition needs and the development strategy specifications, the group's overall budgetary preliminary goals and feasibility demonstration are put forward. In particular, the financial department of the parent company is required to make a draft budget for the feasibility of supporting the financial resources, and the corresponding tasks of the middle-level budget execution organizations are adjusted accordingly, and reasons are given accordingly. Then, the group's initial budgetary objectives and feasibility demonstration, the responsibility objectives and supporting reasons of the middle-level budget execution organizations are submitted to the parent company's operator until the board of directors of the parent company considers it.

Step four, the parent company operators together with the budget management committee convene the meeting of heads of middle-level budget executive organizations. Combined with the market environment situation, board requirements, group development strategy, resource support capability, etc., we can adjust the performance targets of the middle-level budget execution organizations.

Step five, the middle-level budget execution organization convenes the meeting of the head of the grass-roots budget executive organization on the adjusted task targets, announcements the grass-roots budget execution organizations responsible persons for the adjustment requirements and supporting reasons of the task targets put forward by the parent company operators and the budget management committee, and makes corresponding adjustments to the original task targets of the grass-roots budgetary organizations, and instruces the grass-roots budgetary organizations to tap the potential tasks of the adjusted tasks, and puts forward their respective supporting reasons. Then the reasons for the feasibility of the adjustment of the task index are submitted to the budget management committee.

Step six, after the Budget Management Committee receives the mission indicators, feasibility reports or support reasons submitted by the middle-level budget organizations, it conducts further consultations with the main leaders of the middle-level budget execution organizations. Through repeated negotiations and supplemented by coercive measures, the responsibility objectives of the budget execution organizations of the group and at all levels are finally achieved, supplemented by corresponding performance award and penalty standards, and submitted to the parent company's directors for approval with the support reasons. If the board of directors of the parent company decides to pass, the parent company shall instruct or formally prepare the group general budget and the responsibility budget through the budget management committee, and the budgetary execution organization at all levels shall be formally implemented.

　 Follow up control from execution to evaluation

complete Budgeting After that, the next thing to do is to supervise and control budgetary units and employees to translate the budget into expected corporate performance through action and plan. Because all aspects of the company's operation are always dynamic, it is not easy to control and control according to budgetary objectives, and a lot of work needs to be done for routine monitoring and feedback.

The headquarters of the group should strengthen the management and control in the process.

At the end of each year, the group enterprises should consider the implementation of the budget of the previous year and take into account the group's development plan and industrial competition situation, and prepare the group's business budget report this year (the general budget of the group has more general strategic budget components, and the index is also more coarse). At the same time, member enterprises are required to prepare the financial budget report of the enterprise according to the group's operating budget. The budgeting process should be reasonable, and the feedback actions must be done through defining objectives, decomposing tasks, making preliminary budgets, summarizing budgets, preparing sub departmental (enterprise) budgets, and summarizing the process again.

Budget execution, regulation and evaluation process should not be neglected. Only the full implementation of the value recognition and change concept based on extensive participation can ensure the benign operation of the budget control system.

Budget evaluation is the assessment and evaluation of the results of budget execution at all levels of responsibility departments or responsibility centers of enterprises, and it is an effective form of encouragement and constraint for managers to implement them. The budget evaluation has two meanings. One is the evaluation of the entire budget management system, that is, the evaluation of the business performance. It is an effective measure to improve and optimize the profit budget management system. Two, it is the evaluation of the budget executor and the evaluation of its performance. It is a necessary measure to realize budgetary constraint and incentive function. Budget evaluation is part of the process of budgetary control and control, because budget execution and completion must be evaluated timely, so it is a dynamic evaluation and a comprehensive evaluation. Budget appraisal is a link between the preceding and the following in the whole profit budget management cycle.

1. Budget appraisal institutions

The group budget management committee, as a budget evaluation institution, based on the budget control and reporting information, evaluated the budget execution of each budget responsibility center at all stages.

The Ministry of finance, as the specific executive body of budget evaluation, is responsible for collecting, collating and summarizing the information needed for the evaluation work, and accordingly puts forward a scheme for examination and appraisal.

2, budget assessment time

The budget will be scored monthly, quarterly, half yearly and yearly, including monthly analysis, quarterly (half yearly) assessment and pre cash, year-end assessment and cash settlement.

　　 Deviation analysis control method

1. Method introduction

Deviation analysis control method is a way to find deviation and find out the cause of deviation by comparing the actual execution number with the control target. Budgeting and implementation are actually a comprehensive evaluation of the expected financial operation, but such an expectation is a static process after all. In the actual operation process, there will be a variety of situations. In order to achieve the purpose of control, we need to compare the actual situation of budget execution with the original budget, analyze the difference, and supervise the implementation of budget.

2, disadvantages in traditional environment

In the traditional environment, although the deviation analysis management and control law can be implemented, there are many disadvantages:

First of all, in the traditional environment, the use of deviation analysis and control is limited by its inherent frequency, greatly reduced in frequency and greatly reduced in its use.

Secondly, it is also limited by the traditional environment, and the accuracy is not guaranteed.

Finally, in traditional environment, static deviation analysis and control can only be done.

3, solutions

(1) the budget of subordinate units;

(2) the system automatically uploads the budget of subordinate units to their superiors.

(3) the system automatically compares execution with pre compiled budgetary indicators.

(5) exporting all kinds of comparative analysis tables;

(6) the higher level units carry out analysis and control of subordinate units according to the analysis table.