I do corporate training: I’m that stranger you see in your company’s conference room with your colleagues, our spreadsheets blazing. We’re solving accounting, finance, and other business puzzles together, usually for days at a time. Then I’m gone, starting over at a new place the next week. I’ve been doing this around the world for a long time, and I … Read More
Tackling Performance Evaluation Questions
Tackling performance evaluation questions Performance evaluation is a regularly examined requirement in the F5 Performance Management exam, and is a topic that students tend to misunderstand and struggle with. Often examined as a full, 20 mark requirement, the task of crafting a free-form answer that incorporates both supporting calculations and a developed, written discussion is a daunting task. It’s unfamiliar … Read More
The Building Blocks of Performance Management
Building blocks of performance management Performance management—the processes that ensure organisations meet their objectives—is core to the F5 syllabus, and understanding modern performance measurement systems is an important area within this topic. F5 students should already be familiar with Kaplan & Norton’s Balanced Scorecard which is a regularly examined topic and one of the foundations of modern performance measurement. Fitzgerald and … Read More
All About Budgeting 5: Beyond Budgeting
Beyond Budgeting Beyond Budgeting is more than just a method of preparing an annual budget. Instead, Beyond Budgeting encompasses a modern, alternative approach to performance management that looks past the traditional, annual budget as the primary control tool of a company. The Beyond Budgeting philosophy begins with the recognition that many successful modern companies are moving away from traditional, top-down, … Read More
All About Budgeting 4: Zero-Based Budgeting
Zero-based budgeting Review: incremental budgeting Incremental budgeting is a simple, straight-forward approach which uses either last year’s budget or actual results as the starting base for the next year’s budget, only making adjustments for new assumptions, for example, the estimated change in sales, raw material price inflation, or other incremental factors. Whilst this approach might be useful in a predictable, … Read More
All About Budgeting 3: Activity-Based Budgeting
Activity-Based Budgeting The rise of e-commerce, globalisation, and shorter product life-cycles are some of the factors increasing competitive rivalry across many business sectors. Also, indirect costs are becoming a higher percentage of total costs for many companies as technology and automation investments become more crucial to success. Because of this, managers need a deeper and more accurate understanding of the … Read More
All About Budgeting 2: Rolling Budgets
Rolling budget Traditionally, budgets are prepared on an annual basis. After the annual budget is approved, it is usually ‘set in stone’ and not updated during this period. This approach can be useful for controlling a business in a stable, mature industry. However, as many organisations face more volatility and uncertainty, this arbitrary, one-year budget cycle may be too long … Read More
All About Budgeting 1: Flexible Budgeting
Budgeting is an essential part of planning, financial control, and performance management. It is a competency that must be acquired for anyone who is working in finance and accounting and is also a topic which is guaranteed to come up on your Performance Management (PM) exam. Expect to see it in Sections A or B, and there is a … Read More
