Responsibility Reporting Case Study
Our principal consultant, Julie Mabberley, worked with the UK Banking Division of an International Bank and managed the design, specification and implementation of an automated Management Responsibility Reporting system.
The system incorporated management accounting, transfer pricing, profitability reporting by market sector, budgeting, forecasting and variance analysis.
Budgets were produced annually with quarterly re-forecasting. Reports were produced monthly showing the actual performance for each department. Results were compared against budgets for the current month and year to date. Full year forecasts were also compared to annual budgets. Actual results were also compared to the same month and year to date results for the previous year.
All reports (including explanations for variances) were produced within 5 working days of the end of the month.
printable version of this article
See also
Review the Budgeting Process
In a rapidly changing world the tools used to plan the future and manage performance need to be flexible too.
Budgets are Dead, Long live Budgets
Many people are decrying the traditional methods of budgeting and suggesting something new. Yet what is traditional budgeting and how do these new techniques differ?
Outcome Based Budgeting
Traditional budgets measure inputs, agreeing how much resource will be allocated to each cost centre. Yet people are more interested in the outputs achieved.
Budgets as part of MI
Budgets used to be a key management tool but as the importance of non-financial information increases they become a smaller part of MI
Managing the Future
The need for focused management information based on a consistent base of cost effective, timely data is becoming one of the keys to competitive advantage.
Case Study - Responsibility Reporting
We have worked with the UK division of an International Bank to manage the design and implementation of an automated Management Responsibility Reporting System
Static or Flexible Budgets
Flexibility helps internal management but makes reporting harder. Which should an organisation do?
Alternative Budgeting Methods
There are basically 4 methods of budgeting; traditional, zero-based, priority-based, and activity-based although most companies use a combination of methods
