Budget Planning

This document provides information on budget planning, including the nature and scope of budgets, developing a marketing budget briefing report, reviewing marketing budget, and participating in a budget meeting. It also discusses the importance of budget planning in business and provides resources and strategies for effective budget planning.

Budget Planning

MAIN BODY..................................................................................................................................2
2. Determine and confirm scope and nature of the budgets........................................................2
3. Develop a Marketing Budget Briefing Report.........................................................................3
4. Send an email to the CEO and Accounts and Administration Manager..................................4
5. Draft Marketing Budget...........................................................................................................5
6. Participate in a budget meeting................................................................................................5
7. Review marketing budget........................................................................................................6
8. Meet with colleagues to discuss the marketing budget...........................................................7
REFERENCES..............................................................................................................................10
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MAIN BODY
2. Determine and confirm scope and nature of the budgets
To: Paul
Subject: Required internal data access
Dear sir,
I hope you are doing well and safe, after reviewing the master marketing budget it has been
observed that projected marketing budget of Blue Healer for the period of 2019-20 is $ 80500.
On the other side actual cost of entire marketing activities are $ 92000, there are huge
difference in the actual of projected amount. So, I just want to cross check all the figures
related to this budget. I want the access of internal data source to check the reliability of
budget. Budget is very essential for the organization and before making any budget, manager
has to review its nature and scope. It will be discussed below:
Nature of the Budget:
The budget will generally be combined with corporate strategy. The budget describes goals in
specific and quantitative terms for business as a whole and the as with each business function.
It sets out guidance for how to accomplish these goals. It's much more operational and
convincing -in nature than the corporate strategy, and that is the duty of line managers to
prepare it.
The budget normally spans a one-year cycle with a monthly and quarterly break-up. In order
to plan such a budget, it is important to evaluate the existing ability (assets and people) and
financial performance of a company and to formulate projections about external climate,
including the performance of the market, the actions of competitors and present and projected
market demand.
Some companies are adopting the 'constant (rolling) budget scheme. Under this scheme, in
the end of every month or quarter, the budgeted amount just ended is decreased in
the following month or quarter is added. The biggest benefit of such a plan over the periodic
budget would be that it continually requires managers to decide concretely for the next 12
months.
Under this framework, a schedule for the next 12 months is available all the time. However, a
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simpler system is to schedule the budget for one year, broken down into monthly plans, and to
supplement the budget with such a rolling forecast. The real results are compared
with budgetary amount and forecast goals. Research into causes of differences relative to
budget offers improved training as managers gain insight about in which they have erred in
constructing budget terms.
Scope of the Budget:
Budgets are developed for various business functions, like production, sales, etc. Real
outcomes are compared with projected budgets and monitoring is carried out. The budgets
provide a wide spectrum of coverage for the whole company. Each procedure or method is
split into a number of items and the criteria are established for each of those elements.
Budgetary regulation involves the origin of spending at the functional level. Standard costing
concerns the specifications of each cost feature. It is a projection of financial statements,
whereas traditional cost projects are cost records.
In relation to Blue Healer, Resort Manager should ensure that budget will be prepared
accordingly and follow all the assumptions and basic requirements.
Thank & Regard
Resort Manager
3. Develop a Marketing Budget Briefing Report
Marketing Budget Briefing Report
Summary:
This report is all about the marketing budget of Blue Healer for the period of 2017-18 and 2018-
19. It includes the review of the cost of marketing activities for both the period. In addition, it
also includes the source of information that could be used to prepare marketing budget and
external factors which impact the budget.
Marketing Expenditure:
On the basis of profit of loss statement of Blue Healer for the both period, it has been concluded
that total spending on marketing in 2017-18 period was $5,000 and in 2018-19 was $5,250.
Marketing expenses throughout the period increases but just $250 and as a Resort Manager, it
would be justified because there are several activities whose price increases such as
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advertisement charges, site development charges etc.
Source of Information:
In relation to Blue Healer, Radio advertisement and community sponsorship is the two main
marketing expenses which are used to build marketing budget. In a marketing budget, actual
expense on radio advertisement is $30,000 and $25,000 for community sponsorship for the
period of 2019-20. With the help of radio advertisement, several people are informed about the
Blue Healer Ltd and what products & services they offer to customers. IN addition, community
sponsorship used to enhance their brand reputation among the general public which can work as
word of mouth promotion.
External factors:
In relation to Blue Healer Ltd, there are some external factors which affect marketing budget
such as change in technology, competitive forces, change in regulations, political activities etc.
These factors also affected the marketing budget of rivalry firms of Blue Healer. Change in
technology provides greater growth and opportunity to expand their business and maximise their
sales and profit margin. On the other side, change in regulation related to the business nature also
affect, it can impact positive as well as negative on business operations.
4. Send an email to the CEO and Accounts and Administration Manager
To: CEO; Accounts and Administration Manager;
Subject: Marketing Budget Briefing Report
Dear sir,
I hope you all are doing well and safe, this mail attached with Marketing Budget Briefing Report
and want to all of you to go through this report and provide your feedback regarding and
modification or input which required to add in this budget.
Marketing Budget Briefing Report covers several aspects such as review on marketing expenses
and that is also based on the profit & loss statement of 2017-18 and 2018-19.
Requested to the CEO and accounts & administration manager to review the Marketing Budget
Briefing Report and provide their valuable feedback on it.
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5. Draft Marketing Budget
To: CEO and Accounts and Administration Manager
Subject: Draft marketing budget
Please find the below attachment.
In this marketing budget there are several expenses which are related to marketing and Blue
Healer and to do this, in order to create awareness regarding their products & services among the
consumers. Marketing budget for the period of 2019-20 include the several activities such as
redesign of web site, SEO, Expo, promotional brochure, community sponsorship, radio
advertisement and contingency amount. Projected marketing budget total cost is $80,000 and the
actual expenses on it, is $92,500. These changes will occur due to increase in web site redesign
and community sponsorship. Increase in the redesign of web site cost is additional $10,000,
education Expo reduces with $2,500, community sponsorship also increases with addition cost
$5,000 and in addition, actual marketing budget does not required the amount for any
contingency. The overall cost of actual budget increase from projected budget with around
$12,500.
Thanks & Regard
Resort Manager
6. Participate in a budget meeting
Role play
CEO & Accounts and Administration Manager: Please explain the marketing budget and
along with the various options which available?
Resort Manager: The marketing budget sets out almost all the money that a organisation
decided to spend on marketing activities to promote their products & services in the market
throughout the year. It can include expenditures such as paid ads, supported web content,
social sponsorship, new marketing personnel, a registered blog domain, and marketing
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automation software.
In context of Blue Healer organization, there are some limited marketing activities which
generate cost such as web site redesign, education expo, SECO, radio marketing, community
sponsorship, contingency amount and promotional brochure.
Marketing budget provide a strong sense of direction for planning the marketing activities. It
allocates limited financial capital more efficiently. Encourages collaboration and preparation
with the other areas and people inside the business such as finance, operations, HR, etc. Provides
a framework for the evaluation of real outcomes. How much you've invested versus how much
you've received from a selling source.
If staff members know that how much they have to spend on the budget, they will get a better
understanding of which marketing options to use to optimise their marketing ROI.
CEO & Accounts and Administration Manager: Please provide some inputs on this budget.
Resort Manager: As per the analysis of this, it has been observed that marketing is almost
acceptable. If, organization wants to minimise their actual spending or make them equal with
projected budget value. It possible when idea of opening online store should drop which save the
$5000 cost and in any month company can pause their radio advertisement which also save
$5000. These inputs can balance the marketing budget and help the business to perform
according to the projected budget amount.
CEO & Accounts and Administration Manager: There are some difference in projected and
actual budget amount, please negotiate this amount.
Resort manager: Negotiation can be possible in some cases such as radio advertisement is
currently done for 6 months, so company can do this on alternate month. It will cut the cost with
50% and the decision of adding inline store is very good because now consumers are preference
online stores to purchase or shopping rather than going out and visit the stores or outlet
physically. If this suggestion finds it appropriate then know me or required any modification in
the budget then tell me as well.
7. Review marketing budget
To: CEO and Senior Managers
Subject: Final Marketing Budget
Dear sir,
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Please find below attachment of Final Marketing Budget,
I hope you all are doing and safe, as per our earlier discussion it has been discussed that
marketing budget will be modifies by me. Final marketing budget mentioned in the end of this
mail, please find it and review the new final marketing budget. According to the modification,
projected marketing budget value is $80,500 or actual market budget amount is $ 77,000.
As per earlier discussion, we can spend on radio advertisement on alternate month in order to
reduce the estimated cost of this marketing activity. Because actual budget overvalued due to
web site redesign and community sponsorship, and both are very important to do because
opening online store is good idea which helps in generating more sales through increasing
demand. In addition, community sponsorship increased due to a bushfire event and the need to
increase community support which improves their brand image and reputation among the people.
Thanks & Regards
Resort Manger
8. Meet with colleagues to discuss the marketing budget
In this meeting, I ensure you all that company’s financial policy and procedure need to be
understood by everyone. In an organization financial management has to play several
responsibilities and reporting arrangements in order to assure that the marketing budget can be
implemented and monitored accurately.
Financial management is a method for performing data analysis and advising senior executives
on profit-maximizing concepts. Financial managers are concerned about the financial stability of
the organization. They generate financial statements; investment programmed, and establishes
plans and strategies for their organisation's long-term financial objectives. Financial management
tasks usually include the financial statements, economic operation reports and predictions. Track
operations to ensure that legal standards are met and monitor workers involved in financial
reporting and budgeting. Monitor business financial results and discuss ways to minimise costs
and evaluate industry dynamics in order to locate prospects for growth or acquisition of other
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businesses. In addition, it allows manager to identify financial decisions.
Budget allocation and amount allocated to each marketing activity:
Overall marketing budget amount is $80,500 which distributed among six activities and yearly
expenses of such activities are like, on website design it will be $ 10,000, on SEO it will be
$12,000, on Expo it will be $ 6,000 and on community sponsorship it will be $ 20,000. In
addition, other marketing activities also required cost of $ 1,500 for promotional brochure, $
30,000 on radio advertisement and $ 1000 as contingency amount.
It is the responsibility of Resort manager to ensure that marketing should be completed in the
given budget, if it will exceed then they has to prepare with another options to complete their
task. Marketing activities are essential to complete in order to make their products & services
aware among the customers. Projected budget for the activity of web site redesign is increases
due to open online store. This strategy is very effective because according to the current
scenario, every business has their online store because mostly people done shopping with the
help of it.
In an organization, every staff members and management team have to be assuring about the
company’s financial policy and procedure. There are some policies and procedures which
discussed and it has to be followed such as. All financial transactions as set out in this policy
have to be approved by the notified authorised individual prior to commencement of the
payment. This policy should be read in accordance with many other relevant finance policies
where applicable. Petty cash can also be used to reimburse up to $ 100 for small business
expenditures where payment by accounts payable or credit card is not acceptable or necessary.
The employee can only be given a credit card upon completion of the Credit Card Authorisation
Form.
A business credit card would only be used for transportation, approved entertainment and
acquisitions of small cost or equipment up to a value of $500. No cash advances shall be made
and use a business bank account unless approved by the sales consultant. If a credit line card is
stolen, the holder of the card must contact the finance manager, who's really responsible for
contacting the authorizing agency and ensuring that the card is cancelled.
The company credit card shall not use for personal expenses. Both holders of credit card are
expected to combine the monthly statement with the expense form, to insert all receipts for fees
paid on the credit or debit card and have the expenditure statement approved by finance manager.
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These statements shall be transmitted to finance manager for reimbursement of the credit card
bill after execution and permission of the monthly expenditures statement. All payment methods
are to be transferred to the business if the individual is asked to do this by the finance manager or
whether they're no longer employees of the business.
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REFERENCES
Books & Journals
Dahana, M. A., 2020. Analysis of The Budget Planning Process and Budget Execution
Process. European Journal of Business and Management Research, 5(4).
Emerling, I. and Wojcik-Jurkiewicz, M., 2018. The risk associated with the replacement of
traditional budget with performance budgeting in the public finance sector
management. Ekonomicko-manazerske spektrum, 12(1), pp.55-63.
Ho, A. T. K., 2018. From performance budgeting to performance budget management: theory
and practice. Public Administration Review, 78(5), pp.748-758.
Lo, W. C., Lu, C. H. and Chou, Y. C., 2020. Application of Multicriteria Decision Making and
Multi-Objective Planning Methods for Evaluating Metropolitan Parks in Terms of
Budget and Benefits. Mathematics, 8(8), p.1304.
Medvetskyi, I., 2018. International trade cooperation and budget planning in Ukraine.
Olaniyan, N. O. and Efuntade, L. O., 2020. Budget and the budgetary control system in tertiary
institution’s financial performance in Nigeria. KIU Interdisciplinary Journal of
Humanities and Social Sciences, 1(2), pp.281-302.
Pěnička, R., Faigl, J. and Saska, M., 2019. Physical orienteering problem for unmanned aerial
vehicle data collection planning in environments with obstacles. IEEE Robotics and
Automation Letters, 4(3), pp.3005-3012.
Romenska, K., Chentsov, V., Rozhko, O. and Uspalenko, V., 2020. Budget planning with the
development of the budget process in Ukraine. Problems and Perspectives in
Management, 18(2), p.246.
van Bavel, J. et.al., 2018. Projecting the Budget and Health Impact of the PD-1/PD-L1 inhibitors
to inform budget planning. European Journal of Public Health, 28(suppl_4),
pp.cky213-216.
Wu, Z. and et.al., 2018. Contingency-constrained robust transmission expansion planning under
uncertainty. International Journal of Electrical Power & Energy Systems, 101, pp.331-
338.
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