Workshop on Effective Budgeting & Operational Cost Control

Program Overview:

The effective management of budgets and operational cost is a key aspect in leading and managing organizations. Budgeting, as well as tracking, controlling, and reducing cost, represent essential activities to be performed and monitored as strategies get executed.

To ensure effective and prudent financial management in the organization, there is the need to prepare a realistic budget and ensure compliance with the approved budget plan. Furthermore, operational costs need to be monitored and controlled so that as to ensure financial discipline. This training program will help participants appreciate the concepts and methodology around cost management and budgeting.


This program is designed for senior managers who manage budgets, managers who are currently managing projects and/or contracts. Senior managers who control cost and budgeting for their departments or organizations will also find this course extremely beneficial.


At the end of the course, participants will be able to:

■ Apply the essential concepts of accounting, budgets and finance

■ Apply the use of unit cost measurements in performance-based budgeting

■ Maintain strategic cost control.

■ Appreciate the importance of reducing unnecessary costs

■ Determine and apply the costs estimated to produce those outputs and calculate a cost per unit of output.

■ Use best practices to create written budget justifications

■ Locate guidance on budgeting for capital assets, and integrate performance budgeting into your organization’s budget formulation process

■ Identify appropriate outputs for an organizational unit or programme component.


Course Outline:

Day 1: Understanding the Common Financial Language

Key role of budgeting and cost control in contemporary organizations

The 21st-century business imperative: delivering value-added

Towards a cross-functional process-view of the organization

Financial vs. Managerial accounting (decision making)

Understand your processes: integrating financial and non-financial aspects

Identify the key processes/projects for your own organization

Day 2: Contributing effectively to Strategic Planning

Budgeting and Cost analysis

Cost concepts and terminology

Different costs for different purposes

Fixed Vs Variable costs: the Cost-Volume-Profit analysis model

Contribution Margin analysis

Manufacturing vs. non-manufacturing costs

Period Vs. Product costs: inventory evaluation and control

Day 3: Linking Budgeting and Forecasting into the Business’ Strategy

Traditional vs. Advanced Techniques in Cost-control

Under-costing and over-costing: the consequences for profitability

How to refine a costing system?

Indirect (OH) Vs. Direct costs: Traditional Cost Allocations systems Vs. Activity-Based Costing (ABC)

Cost hierarchy & Cost drivers

Linking resources, activities, and management

Introducing Activity-Based Budgeting (ABB) and Management (ABM)

Day 4: Preparing Rolling Forecasts

Role of forecasts and the link to strategy

Comparing and contrasting budgets and forecasts

Identifying key business drivers

The rolling forecast process

Forecasting methods

Applying ‘best practice’ risk management and control

Role of risk management in corporate governance

Finance’ role in supporting risk management

Cost / Effective risk management in Finance’ own processes

Day 5: Cutting costs and improving effectiveness

Role of cost management in the business strategy

Cost management and motivation

Embedding cost control in the business

Role of Finance in cost control

Beyond the Budgets: Balanced scorecards and Six-sigma

Broadening performance measurement systems

The key role of customer satisfaction and business process re-engineering

Beyond budgeting: integrating financial and non-financial issues

Introducing the Balanced Scorecard

Introducing the Strategy maps

Training Methodology

Methodology: Lectures, discussions, exercises, case studies, audio-visual aids will be used to reinforce these teaching/learning methods.