Knowledge Centre

Plan your money before you spend it — and stay in control of your business

Budgets 

1. What You Need to Know

A budget is a financial map of your business. 
It shows expected income, expenses, and investments over a set period. Accountants prepare budgets based on realistic assumptions and help compare them with actual results. This lets you make informed decisions, cut waste, and stay efficient. 

2. Why It Matters to You

Budgets give you control instead of surprises. 
Shows where your money will come from and where it will go. 
Highlights overspending before it drains your profits. 
Gives you confidence when applying for loans or funding. 
Helps align staff and managers to clear financial goals.  

3. Frameworks, Standards, or References 

Budgeting blends financial discipline with management frameworks. 

  • Frameworks to use: Zero-based budgeting, Rolling forecasts, Variance analysis. 

  • Standards & compliance: IFRS for SMEs (management reporting guidance), Companies Act (solvency/liquidity awareness). 

  • References: CIBA practice standards on management accounting. 

  • What your accountant will actually do: 

  • Prepare annual or quarterly budgets tailored to your business. 

  • Compare budgeted vs. actual results and explain variances. 

  • Update rolling forecasts as conditions change. 

  • Provide budget reports for funders or board presentations. 

4. How to Apply

Steps to make your budget work for you: 

  1. Define financial and operational goals with your accountant. 

  2. Prepare a detailed budget for at least 12 months. 

  3. Review monthly performance against the budget. 

  4. Investigate and act on major variances. 

  5. Update forecasts as your business environment changes. 

5. Common Mistakes to Avoid 

Avoid these budget blunders that waste money: 

  • Guessing numbers without data → Base assumptions on real figures. 

  • Setting unrealistic targets → Be ambitious but grounded. 

  • Preparing once a year and forgetting → Review monthly. 

  • Not linking budget to strategy → Align spending with goals.