Departmental Budgets and Cash Flow Forecasts

Visual Cash Focus has strong capabilities for producing departmental budget and cash flow forecasts. A profit center is essentially any entity which forms part of a greater unit but for which budgets and cash flow forecasts are required both individually and as part of the unit, for instance different branches of a national retail outlet or departments within a company etc.

Any number of departmental (profit centers) budgets are catered for. Each profit center manager can enter their own budgets. Reports include the profit & loss/income statement and cash flows per profit center, per group of profit centers or for the enterprise. You can determine profitability and forecast cash flow for the whole organization or per profit center. Profit centers otherwise known as departmental budgets extend the capabilities of your budget model considerably for very little effort.

When to use departmental budgets

Budget preparation involving multiple departments or profit centers can occur in either of two ways depending on the outcome required and determined by how data is input. Independent entities can each be prepared as a separate budget model followed by budget consolidation of all of the models. Alternatively consolidated the whole company can be included in a single budget sub-divided into profit centers. The determining factor between which method to use is the Balance Sheet. If you want the whole organisation to share a common Balance Sheet then use departmental budgets.