5 Must-Have Features to Look for in a Budget Approval System
A 2017 survey by CFO Research revealed that more than half of the financial executives surveyed used spreadsheets for budgeting, and that only 6 percent of them were satisfied. These shocking numbers reveal how businesses stick to outdated systems despite their error-prone traits.
While budget approvals seem straightforward, things often tend to drag on because of the limitations of manual processes. There’s no validation of data, and you can’t say with confidence that you have the correct information. There’s every chance of miscommunication, and there’s no way to ensure that the approved version is the final version of the budget.
A budget approval system helps you cut through laborious paper forms, spreadsheets, and a sea of emails.
What is a budget approval system?
A budget approval system helps department heads set their budgets according to estimated revenue. The tool ensures compliance with the organization’s policies. A budget approval system helps the finance teams approve the budget, who make sure that every department has adequate funds for effective functioning.
Why use a budget approval system
Most businesses use spreadsheets and emails to prepare and approve budgets. They’re great tools but for different purposes, and make your budget flow complex and time-consuming.
Budgets with shorter cycles are commonly affected because they can become obsolete by the time they are approved. A budget approval system irons these wrinkles and speeds up approvals.
1. Increased Transparency
When you use a budget approval form, everyone stays informed about the progress at all times. You can always identify tasks that need to be completed.
2. Data Integrity
Automated systems minimize data entry by fetching data automatically from other sources whenever possible. This eliminates manual errors and you can be confident about the accuracy of your data.
3. Faster Approvals
Automated approvals ensure that budgets are accurate and compliant with the organization’s policies. Approvals become faster and straightforward as you don’t have to sift through rows of data to get the information you need.
5 must-have features to look out for in a budget approval system
There’s no one-size-fits-all solution when it comes to budget approval process. However, there are some basic features every budget approval tool needs, and you cannot do without:
1. Dynamic Data Processing
One of the areas where a spreadsheet fails is that data just sits there unless you manually make it move somewhere. It’s dependent on emails and people remembering the approval workflow and following up on it.
Your system should let employees collaborate. There should be room for scalability. A system with automatic approvals based on predefined criteria is effective in cutting down your approval times.
3. Manage Multiple Versions
A budget is rarely set in stone. It goes through a bunch of iterations before you arrive at the one that gets the green light. It’s important to keep track of all the versions and it also ensures that only the latest version is available for approval.
4. Advanced Reporting
A good budget management system gives you insights and helps you identify bottlenecks. It becomes easy to compare previous years’ data to avoid any discrepancies.
5. Integration With Other Software
When you’re using spreadsheets to handle budgets, you need to manually gather data from different sources like accounting, expense management, and payroll. Connecting all these systems is vital to ensure everything runs smoothly and efficiently.
How Kissflow Finance & Ops Cloud can help?
Every organization has its own budget workflow. There could be one person who prepares the budget, or a whole team could be involved in the process. Budgets are approved by one or more people, or you may need budgets on a project basis. The bottom line is that what works for one organization might not work for another.
You can customize forms where department heads enter the details. You can even have itemized information in tabular form. This ensures a uniform format no matter who prepares the budget. Most of the information is either pre-filled; you can even fetch data from other tools by connecting them with Kissflow Finance and Operations cloud.
You can create an approval hierarchy and ensure that information reaches the right person at the right time. It makes it easier for them to approve a budget or make a new iteration.
Moving Beyond the Spreadsheets
Spreadsheets and emails are not really built for a budget approval system. They eat up your time and resources and arm you with incomplete and inaccurate information. A dedicated budget approval system helps you eliminate all these pitfalls, speed up processes, and plan a budget that’s directed toward growth.