Budgeting and Forecasting and Behavioural Finance Fundamentals
Budgeting and Forecasting and Behavioural Finance Fundamentals
If you are responsible for financial management and accounting as well as budgeting and forecasting within the organisation that you work for then this course module is definitely for you.
‘Get on top of the bottom line’
Course description part 1 – Budgeting and Forecasting
Who is this course module suitable for?
Module prerequisites
Participants should already have a good grasp of:
- Fundamental accounting terms and principles
- Reading and understanding of basic financial statements
- The basic Excel functions including formulas and shortcuts
Module Objectives
In this interactive module dealing with budgeting and forecasting you will learn a number of applied techniques including:
- How to take a disciplined approach when developing budgets
- Forecasting results using quantitative and qualitative methods
- How to effectively use variance analysis for performance tracking
- How to develop concise charts and graphs to present results
If you are responsible for financial management and accounting as well as budgeting and forecasting within the organisation that you work for then this course module is definitely for you.
What will I learn from this module?
Upon completion of this module you will be equipped to:
- Grasp the principles behind best practice financial management.
- Describe and expand on the importance of budgeting within a strategic framework.
- Develop and build an effective budgeting process.
- Discern the appropriateness of using various budgeting approaches such as zero based budgeting.
- Better analyse revenue and cost drivers and forecast future performance.
- Track organisational performance by using effective variance reporting.
- Effectively use Excel functions and tools designed for the budgeting process.
Module content
The following topics are included:
- The budgeting process within a strategic framework
- Developing an effective budgeting process
- Management of budget psychology
- Practical guide to budget development
- Common approaches to budgeting, such as incremental, value based, zero based etc.)
- Forecasting techniques including moving average, regression analysis, etc.
- Using variance analysis to track budget performance including waterfall charts etc.
- Applied budgeting tools and techniques including Excel, solver, pivot tables, etc.
If you are responsible for financial management and accounting as well as budgeting and forecasting within the organisation that you work for then this course module is definitely for you.
Module curriculum
- Introduction
Curriculum
Course objectives
Prerequisites
Download files and templates
If you are responsible for financial management and accounting as well as budgeting and forecasting within the organisation that you work for then this course module is definitely for you.
- Budgeting within a strategic framework
Objectives
Barriers to strategy execution
Translating the strategy into a business plan
Balanced score cards
Top reasons to budget
Quiz
What to watch out for
- Developing an effective budgeting process
Objectives
The master budget
3 categories of budgets
Manufacturing company example
Retail company example
Services company example
Quiz
Budgeting – where to start
Steps in the budgeting process
Psychology and target setting
Top down vs. bottom up involvement
What to watch out for
- A practical guide to developing budgets
Objectives
4 approaches to budgeting
Incremental budgeting
Activity based budgeting
Value proposition budgeting
Zero based budgeting
Quiz
Beyond budgeting
- Forecasting Techniques
Objectives
Cost types
Modified cost types
Cost structure and earnings volatility
Excel cost analysis model
Cost control matrix
Forecasting methods
Moving averages
Linear regression
Excel “Forecast” function
Equation of a line regression
Multiple regression overview
Multiple regression in Excel
Quiz
PEST analysis
Porter’s 5 forces
If you are responsible for financial management and accounting as well as budgeting and forecasting within the organisation that you work for then this course module is definitely for you.
- Tracking Budget Performance with Variance Analysis
Objectives
What is variance analysis
Volume vs. price
Cost variance
Variance analysis in Excel
Variance waterfall chart in Excel
Presenting results of variance analysis
Root cause analysis
Quiz
- Applied Budgeting Tools and Techniques in Excel
Objectives
Goal Seek tool in Excel
Solver tool in Excel
Consolidate function in Excel
Pivot Tables overview
Setting up a Pivot Table in Excel
Pivot Table filters
Adding calculated fields to a Pivot Table
Slicer and timeline functions
Beyond Excel
- Conclusion
Conclusion and recap of objectives
Download completed files and templates
- Qualified Assessment
Qualified Assessment
Course Evaluation
Course description part 2 – Behavioural Finance Fundamentals
What is behavioural finance?
In essence, behavioural finance involves the study of how psychology influences the behaviour of financial practitioners. This module deals with the various decision making biases and information processing errors that influence financial decision making.
Section 1 – Decision making biases and errors
This first section examines how behavioural finance determines market activity and the behaviour of financial practitioners. Upon completion of this section you will have gained a good grasp of what the various behavioural biases entail including optimism and overconfidence biases.
This section includes:
- An overview of the decision making biases and errors
- Reflective versus reflexive decision making
- How overconfidence and optimism impact decision making
Section 2 – Information processing errors
This section covers a broad spectrum of behavioural biases and information processing errors. Upon completion of this section you will have acquired an in-depth understanding of the self-attribution, hindsight, confirmation and representative biases.
This section includes:
- Self-attribution and hindsight biases
- Confirmation and representative biases
- Guarding against the narrative fallacy
Section 3 – How decisions are impacted by others
In this section we continue to examine the different behavioural biases and errors and learn how decision making is impacted by others. Upon completion of this section you will have gained a thorough understanding of the anchoring bias, loss aversion as well as herding behaviour.
This section includes:
- The anchoring bias
- Loss aversion
- Herding versus independent thinking
Module curriculum
- Decision making biases and errors
Downloadable files
Overview
The psychology of markets
We all make mistakes
Which one are you?
Spock vs McCoy
Quiz
CRT questions
CRT answers
Quiz
Self-control is not enough
Rate your driving abilities
Recent driving ability surveys
Quiz
Overconfidence and over-optimisim
Illusion of knowledge and control
If you are responsible for financial management and accounting as well as budgeting and forecasting within the organisation that you work for then this course module is definitely for you.
- Information processing errors
Self-attribution bias
Hindsight bias
Quiz
Confirmation bias
The narrative fallacy
Quiz
How does this appear?
Representative bias
How does this appear? Part 1
How does this appear? Part 2
Framing bias
Quiz
- How decisions are impacted by others
Anchoring bias
Quiz
Loss aversion
Which restaurant do you go to?
Herding bias
Quiz
Herding and independent thinking
Quiz
Process, process, process
Prepare, plan and pre-commit
Quiz
- Qualified Assessment
Qualified Assessment
Course Evaluation
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