7 Tips for Surviving Budget Season

By: Jenna Blackwood

Accounting firms and companies around the globe are in the midst of many finance and accounting professionals’ least favorite times of the year: budgeting season (although I enjoy it).

Budgets are crucial for setting plans and identifying opportunities to keep the business operating and profitable. However, it’s also time-consuming and can be fraught with negotiations.

The following steps can make budgeting season less of a headache for your team.

Step 1: Start with a budget-to-actual review

We typically begin the budgeting process in early September, which gives us plenty of time to work through the process and solidify the budget before the new year.

Start by reviewing your actual year-to-date numbers and projections with what you budgeted for the year. Where were you on target? Where did you over or under budget? Why?

Looking back before you look forward provides a wealth of information that can help you make projections for next year.

Step 2: Gather departmental expenses

Ask each department in the firm to develop their budget expectations for the coming year. While executive leadership might take the lead on finalizing the budgets, getting operational departments involved ensures you have all the information you need to balance top-down goals with bottom-up projections.

Plus, when departmental leaders know they have a voice in the budgeting process, they’re more likely to accept the results.

Step 3: Forecast price increases

Price increases for subscriptions, wages, benefits, supplies, services and other line items are often inevitable, but with today’s inflationary pressures, they deserve extra attention.

Consider whether you can secure pricing from suppliers for the next year or raise fees to offset your higher costs.

Step 4: Look at your strategic plan

Are you planning on hiring new team members, investing in new technologies, or offering new benefits to attract and retain talent in the coming year? Make sure you’re accounting for these additional costs.

Hiring a new team member isn’t just about their salary. It can also impact benefits, technology, travel expenses and more.

Step 5: Compare revenue projections to your 10-year vision

Compare your revenue projections to the firm’s 10-year vision. How are those numbers tracking? You may want to adjust the numbers and tweak the current services you are providing to get on track for what you want the firm to look like in the future.

Step 6: Consider using a budgeting tool

We are currently using Jirav for our financial budgeting and forecasting process. It allows us to use drivers and assumptions to determine price increases. Since this is our first time using it for this purpose, we’re also planning on making those projections manually to compare results.

If your firm’s leaders are frustrated by manual budgeting processes or struggling to feel confident in their projections, consider looking into a financial forecasting platform. It can make creating and updating your forecasts and budgets much easier.

Step 7: Celebrate at the end of the process!

Even with world-class tools and a great team, the budgeting process can be stressful. So be sure to plan a small celebration at the end of the process to thank people for their time and effort. Consider taking everyone out for drinks or lunch, sending gift cards, or giving your team a day off when they least expect it. Small gestures can go a long way toward making people feel appreciated and securing their support next time budgeting season rolls around!