Excel_budgets_part_6

Excel_budgets_part_6 - B UDGETING Part 6 of 6 Really Using...

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BUDGETING ILLUSTRATION: MARCEL DUROCHER/WWW.MARCELDUROCHER.COM Really Using an Excel-Based Budget You’veCreated By Teresa Stephenson, CMA, and Jason Porter Part 6 of 6 3 8 STRATEGIC FINANCE I July 2010
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Budgeting. Months of work, careful analysis, and lots of meetings. But did you end up with a tool that your company will use for the next year or with a doorstop for the accounting office? This is the last in a series of six articles addressing how to create an Excel- based Master Budget that you’ll really use. If you’ve read this series from the beginning, you probably already have a working, fully linked Master Budget. (If you haven’t been reading it, feel free to go back to the February 2010 issue and catch up with us. We’ll wait for you here.) This final article will help you lock your budget so you can send it to other managers without fear that they will mess up your hard work, will show you how you can use this powerful tool for “what-if” scenarios, and will address some of the ethics issues surrounding the budgeting process. Locking the Budget Now that your budget is finished and all the estimates are fair, unbiased ones based on the most current informa- tion you can gather cost effectively, it’s time to let the managers actually use your budget! This can be a nerve- racking experience. Who wants to let another manager mess around with his or her hard work? After spending this much time on a project, the last thing you want is to have some careless person down the hall change one of your carefully created equations. This can lead accoun- tants to be overly protective of their budget, creating a beautifully functional tool that other managers know is out there, somewhere, but beyond the reach of mere mortals—like the elusive unicorn. We’ve all gotten pos- sessive with projects that have taken a lot of our time; now we have to find a way to overcome the urge to pro- tect our spreadsheets from unworthy users. One easy way to avoid this syndrome is to lock the budget so that managers can see all of the equations and figures but can’t change them. Perhaps a better way is to lock the budgets but leave portions of the Data Input Sheet open for revisions. That way, all of the managers can input their different estimates and see what effect they will have on the budget. If you do it right, you won’t even have to type in the data anymore. You can send the new budget to each manager, let them type in their own numbers, and then present the final draft to management without having to do much but create the file for the new year. Let’s walk through the steps to lock a budget using Excel 2007. Of course, if you’re using an older version of Excel, the instructions are easy to find by looking up “Protect Worksheet” in the help files.
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