Introduction
Managers must ensure they can create a comprehensive and convincing budget proposal. Therefore, they need analysis supporting documentation and evidence. One may distinguish several critical steps and elements in budget preparation.
Key Stages in Budget Formulation
Firstly, managers should align the proposal with the organization’s objectives and mission. The budget should emphasize how it will contribute to achieving goals (Zhang & Bohlen, 2023). Secondly, managers must collect data on the financial situation and metrics affecting the organization’s financial position for forecasting. The measure may require the involvement of stakeholders to gather information.
Thirdly, the analysis will include an assessment of the organization’s needs for capital budget (Zhang & Bohlen, 2023). Finally, after the investigation, managers write a budget proposal and submit it to the leaders. It is essential to provide potential concerns and questions to respond to them and make the offer convincing.
Key Components in Budget Formulation
Forecasting is one of the critical aspects of budget planning, as it provides evidence about the potential benefit of the proposal and makes it convincing. Forecasts are grounded on data that managers collect, and for this reason, they are reliable evidence for decision-making (Pink & Song, 2019). Moreover, computer modeling forecasting allows companies to consider patterns, trends, and the impact of various forces in health care to write more profitable and accurate budget proposals. Managers need extensive knowledge and skills to prepare a budget and may need additional resources. They require the organization’s financial documentation and performance reports to extract data.
Conclusion
Technologies can be critical and help managers with their duties (Campbell, 2008). For instance, accounting tools and software will support the accuracy of the plan and facilitate its drafting. The effective use of tools and skills is essential for creating a budget proposal. Hence, managers must carefully monitor the organizational processes, understand the department’s specifics, and expand financial knowledge.
References
Campbell, R. J. (2008). Change management in health care. The Health Care Manager, 27(1), 23-39.
Pink, G. H., & Song, P. H. (2019). Gapenski’s understanding healthcare financial management (8th ed.). Health Administration Press.
Zhang, R., & Bohlen, J. (2023). Healthcare business budgeting. StatPearls.
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