The budget
If you want to manage the budget, you’ll need all the right information…
Conversation about the budget
James: Have you finished the staff and overhead budgets for your department? The finance director wants everyone’s budgets by Friday. I can’t believe this has come round so quickly - it only seems like five minutes since our year end.
Sarah: I’ve put in ail my numbers for the big things like salaries. And I’ll need to allocate some money for recruitment next year, too, as Vanessa will be going on maternity leave in June. I just need to get an idea from my team of how much travel they’ll be doing next year so that I can put in my number for expenses.
James: Expenses are hard, to forecast. My department went over budget this year.
Sarah: Well, you made some great sales, too, so I wouldn’t worry too much. I don’t envy Kevin, though. He has to take all the departmental overhead budgets and the divisional sales forecasts to produce the whole balance sheet.
James: Is that the same as the profit and loss account?
Sarah: I think so, although it’s all double Dutch to me: fixed assets, current assets, fixed liabilities, current liabilities! Fortunately I’m in marketing and not accounts!
James: Me, too. It’s all that double-entry book-keeping that I don’t understand!
Sarah: Well, so far this year we’ve out-performed our projected margin, so we must be doing something right.
James: Yes, our shareholders will be pleased with the chairman’s annual report.
Sarah: Year-to-date, our bottom line is about six per cent up on budget and more than ten per cent up on last year. If our sales continue to grow at the current rate and we keep our overheads down, we’ll all be getting our bonuses!
James: That’s one thing that I won’t have any difficulty forecasting!
James: How I’m going to spend my bonus! I’m getting a plasma screen home entertainment system!
Words and phrases from the dialogue
overhead budget = budget pour les frais généraux
maternity leave = congé de maternité
go over budget = dépasser le budget
balance sheet = bilan
profit and loss account = compte de profits et pertes
double Dutch = baragouin
fixed/current assets = immobilisations/actif de roulement
fixed/current liabilities = dettes à moyen et long terme/dettes à court terme
double-entry book-keeping = comptabilité en partie double
projected margin = marge prévue
chairman’s report = rapport annuel du président
Other accounting words and phrases
balance the budget = équilibrer le budget
capital invested = mise de fonds
cash flow = marge brute d’autofinancement
cash flow problems = difficultés de trésorerie
cash transaction = opération au comptant
profit margin = marge bénéficiaire
share capital = capital actions
working capifal = fonds de roulement
What is the value of our business?= Quelle est la valeur de notre affaire ?
How can we keep our overheads under control?= Comment peut-on bien gérer les frais généraux ?
What are our performance expectations for the next financial year?= Quelles sont nos perspectives de rendement pour l’exercice budgétaire à venir ?
How can we keep our shareholders happy?= Comment peut-on satisfaire nos actionnaires ?