The Power of Financial Planning
Budgets and forecasts are more than spreadsheet exercises—they’re tools for translating strategy into action, creating accountability, and navigating uncertainty with confidence.
The problem with most budgets: They’re created as a compliance exercise, gathering dust by March, and used more for blame than for guidance. Forecasts, when they exist, are wishful thinking rather than realistic projections.
At Oppenheim Advisory, we believe financial planning should drive decisions, not just document them. Our approach creates budgets people believe in and forecasts that actually help you run the business.
Our Approach to Budgeting
Strategic Foundation
Every budget should flow from strategy. Before diving into numbers, we ensure clarity on:
- Business objectives: What are you trying to achieve this year?
- Strategic priorities: Where will you focus investment and effort?
- Key assumptions: What market, competitive, and operational assumptions underpin the plan?
- Resource constraints: What limits will shape your choices?
Bottom-Up Input
The best budgets combine top-down direction with bottom-up realism:
- Revenue planning: Sales pipeline, pricing, new products, customer retention
- Cost planning: Headcount, operational costs, project costs, overheads
- Investment planning: Capital expenditure, R&D, marketing initiatives
- Working capital: Debtor and creditor assumptions, inventory requirements
Integration and Challenge
We bring together the components and stress-test the result:
- Does the plan deliver the required returns?
- Are the assumptions realistic and internally consistent?
- What are the key risks and dependencies?
- Is the plan achievable with available resources?
- What happens if key assumptions prove wrong?
Presentation and Approval
We prepare professional budget documentation for board and stakeholder approval:
- Executive summary with key highlights
- Strategic context and priorities
- Financial summary with key metrics
- Detailed supporting schedules
- Assumptions and risk analysis
Rolling Forecasts
Static annual budgets have limitations—they become outdated as circumstances change. Rolling forecasts address this:
Monthly Updates
Each month, we update the forecast based on:
- Actual results year-to-date
- Known changes to expected revenue
- Revised cost expectations
- Updated timing assumptions
Quarterly Reforecast
Every quarter, we conduct a deeper review:
- Comprehensive reassessment of assumptions
- Updated view for the remainder of the year
- Initial view of the following year
- Scenario analysis for key uncertainties
Benefits of Rolling Forecasts
- Always current: Never relying on stale assumptions
- Decision-relevant: Forecasts that reflect reality
- Trend visibility: Easy to see how expectations are evolving
- Early warning: Problems surface before they become crises
Scenario Planning
In uncertain environments, single-point forecasts can be misleading. Scenario planning addresses this:
Key Scenarios
We typically develop three scenarios:
- Base case: Most likely outcome based on current trajectory
- Upside case: Optimistic scenario if things go well
- Downside case: Pessimistic scenario if challenges materialise
Sensitivity Analysis
For each scenario, we identify:
- Key assumptions that differ between scenarios
- Financial impact of different outcomes
- Trigger points that indicate which scenario is materialising
- Actions to take in each scenario
Decision Support
Scenario planning enables better decisions:
- “What would we do if X happens?”
- “How much downside protection do we need?”
- “What’s the upside from additional investment?”
The Budgeting Process
Timeline
A typical annual budget process:
Weeks 1-2: Strategic kickoff
- Review prior year performance
- Confirm strategic priorities for coming year
- Issue budget guidelines and templates
Weeks 3-4: Departmental budgets
- Revenue planning with sales/commercial teams
- Cost budgets from department heads
- Investment proposals reviewed
Weeks 5-6: Integration and challenge
- Consolidate departmental inputs
- Challenge and refine assumptions
- Iterate to achieve required outcomes
Weeks 7-8: Finalisation and approval
- Prepare board presentation
- Final review and adjustments
- Board approval
Our Role
We facilitate the process, bringing:
- Structure and discipline to keep on track
- Financial expertise to challenge assumptions
- Integration skills to bring pieces together
- Professional presentation for stakeholders
Who Benefits from Better Budgeting?
Our services are particularly valuable for:
- Growing businesses needing more sophisticated planning
- Businesses with boards or investors requiring professional forecasts
- Companies preparing for exit needing realistic projections
- Seasonal businesses with complex cash flow patterns
- Multi-location or multi-entity businesses requiring consolidated planning
- Businesses in uncertain markets needing scenario planning
Case Study: Budget Transformation
A marketing agency had historically treated budgeting as a finance exercise, with limited buy-in from the team and budgets that bore little relation to reality by mid-year.
We transformed their approach:
- Strategic kickoff workshop with leadership team
- Bottom-up input from practice leads and department heads
- Monthly forecast updates with actuals vs budget review
- Quarterly reforecast with board presentation
- Scenario planning for key risks and opportunities
Results:
- Budget ownership across the business, not just finance
- Forecast accuracy improved from ±25% to ±10%
- Earlier identification of emerging issues
- Better resource allocation decisions
- Board confidence in financial projections
Getting Started
Transform your financial planning with a structured approach:
- Assessment: Review your current budgeting and forecasting processes
- Design: Create a planning framework suited to your business
- Facilitation: Guide you through the annual budget process
- Maintenance: Support ongoing forecasting and analysis
Ready to improve your financial planning? Book a free consultation or call us on 07990 835891 to discuss your requirements.