Drawing up a current financial plan

Financial plan - component intra-company planning, the process of developing a system of indicators to provide the enterprise with the necessary funds and improve the efficiency of its financial activities in the future. Financial planning is one of the main management functions, including determining the required amount of resources from various sources and rational distribution of these resources over time and by structural departments of the enterprise.

Financial planning is necessary to provide the necessary resources for the company's activities for:

• choice of options for effective investment of capital;
• identification of on-farm reserves to increase profits through the economical use of funds.

It helps to control the financial condition, solvency and creditworthiness of the enterprise.

There are many methods for calculating financial planning, but there are also general rules, principles that are unchanged regardless of how the financial plan is drawn up.

It is important. Financial planning should be targeted, operational, real, managerial, collective, regulated, continuous, comprehensive, continuous, balanced, transparent process for management. The cost of financial planning should not overlap the effect of it.

financial planning- a responsible process, so you can not approach it formally.

In the course of planning, it is necessary to draw conclusions about the reasons for failures in work, to take into account these factors, along with positive experience, when drawing up financial plans for the next period.

Financial planning should be comprehensive in order to provide financial resources for various areas:

• innovations (that is, the development and implementation of new technologies that affect the maintenance of competitiveness of products, the creation of new products, industries, etc.);
• supply and marketing activities;
• production (operational) activities;
• organizational activity.

When drawing up financial plans, the following are used: information sources:

• accounting and financial reporting data;
• information on the implementation of financial plans in previous periods;
• agreements (contracts) concluded with consumers of products and suppliers of material resources;
• forecast calculations of sales volumes or product sales plans based on orders, demand forecasts, sales price levels and other characteristics of market conditions;
• economic standards approved by legislative acts (tax rates, tariffs for contributions to state social funds, depreciation rates, accounting banking interest rate, the minimum monthly wage, etc.).

In the course of planning, it is necessary, if possible, to take into account or analyze all factors: analytical materials, market trends, the general political and economic situation, the opinions of analysts and experts, moral and ethical standards, etc.

The analysis should be subjected to economic(the refinancing rate of the Central Bank, exchange rates, interest rates on loans in local banks, the amount of available free cash, the maturity of accounts payable, and many others), and non-economic factors (possibility of recovering accounts receivable, level of competition, changes in legislation, etc.). Before making a decision, it is important to evaluate all available alternatives. Moreover, it is more expedient for the accuracy of the plan to evaluate not the strict value of the indicator, but the range of values. It is important to take into account possible force majeure situations.

Note. Plans should be focused on achieving the set goals (the basis of the plan is the real capabilities of the company, and not its achievements at the moment).

For example, the company's turnover is currently 1,000,000 rubles, and if the shortcomings in the work are eliminated, then the turnover can be relatively easily doubled. If in such a situation the plan is based on the existing indicators, then we will not take into account the potential of the company (the financial plan will be ineffective).

The financial plan should (if you do not consider various scenarios for the development of events) contain a certain strategy of action in the event of the most likely forecast situations. For example, a company in its calculations uses conventional units - US dollars. The management of the company needs to have a strategy of action in case of abrupt change the dollar exchange rate and consolidate their ideas in the financial plan, so that subordinates also clearly represent this strategy.

When drawing up a plan, it is necessary to foresee the possibility of revising the planned indicators as they are achieved. One way to achieve flexibility in plans is to establish minimum, optimal, and maximum outcomes.

Note. It is impossible to draw up a financial plan so that, in accordance with it, the company does not have a cash reserve.

Such a situation can lead to the fact that any force majeure, unscheduled payment or delay in receipts can lead not only to the collapse of such financial plan but also the company itself. Still, it is easier to profitably invest excess funds than to find the missing ones.

When attracting additional financial resources, it is necessary to adhere to conformity principle, that is, it is irrational to take a short-term loan to purchase expensive equipment, knowing that during this period the company will not have free cash and will have to borrow money again to repay the loan.

Suppose a company needs funds to replenish inventory, the average implementation period of which is one month. In this case, it is unreasonable to take a long-term loan, overpaying for it.

Many are mistaken, considering the net or retained earnings of the company as some real assets that can be put into economic circulation. Often this is far from the case. Therefore, when carrying out financial planning, determining the need for additional sources of financing, one cannot make a mistake referring to such indicators as retained earnings, retained losses.

One of the stages of planning is the financial analysis, during which the solvency of the company is analyzed. A common mistake is that financiers include indicators in the plan, which they themselves criticize during the analysis of actual indicators. Often a situation arises when poorly liquid and insolvent financial plans are created. To avoid this, it is necessary to remember about the indicators for assessing liquidity and solvency, as well as focus on them when drawing up a financial plan.

Types of financial planning and financial plans

The time periods for which financial plans are drawn up may be different. Typically, financial plans are drawn up for some rounded period (month, quarter, six months, 9 months, 1–3 years or more). This tradition is due to the convenience of work: it is much better to make a plan and use it for a year than a year and 10 days.

Depending on the period for which the plan is drawn up, there are long-term, medium-term and short-term plans (Table 1).

Table 1. Types of plans and their features
Type of financial plan	Name of planning	The period for which the financial plan is drawn up
Short	Operational
medium term	tactical
long term	strategic	over 3 years

This classification has its drawbacks. medium term financial plan we call a plan drawn up in 1-3 years. But if we take a construction company, it turns out that it takes an average of 1-3 years to build one object. Therefore, a plan drawn up for three years (formally medium-term) will be for the company short-term. The time period for which a financial plan is drawn up is essential.

Financial plans can be basic and auxiliary (functional, private). Auxiliary plans designed to ensure the preparation of the main plans. For example, master plan includes planned indicators of revenue, cost, tax payments and many others.

In order to bring all the indicators into one plan (the main one), it is necessary to first draw up a number of auxiliary plans for almost every indicator. You should plan the amount of revenue, cost and other indicators (only then you can bring everything together, having received the main plan).

Note. Plans can be formed both for individual divisions of the company, and for the entire company as a whole. Consolidated aggregated financial plan of the company, which includes the main plans individual divisions, will be the master financial plan.

By the time of drawing up financial plans can be:

• introductory (organizational) - are formed on the date of organization of the company;
• current (operational) - compiled periodically during the entire period of the company's operation;
• anti-crisis;
• unifying (connecting, merger plans);
• separating;
• liquidation.

In a relationship anti-crisis, unifying (connecting),separating, liquidation financial plans, it is easy to conclude that they are drawn up when the company undergoes reorganization (recovery) procedures, the organization is merged, divided or is at the stage of liquidation.

The need for the formation of an anti-crisis financial plan arises when the company is at the stage of apparent bankruptcy. With the help of an anti-crisis financial plan, you can determine what the company's real losses are, whether there are reserves to pay off accounts payable and what is their estimated value, as well as ways out of this situation.

Dividing and unifying(connecting, merging plans) financial plans can be called antipodal plans. Connecting(unification, merger plans) and separating financial plans are drawn up when one company joins another or when a company is divided into several legal entities. That is, connecting (unification, merger plans) and separation plans are formed during the reorganization legal entity, which can be in the form of a merger, accession, division, spin-off or transformation. unifying(connection, merger plans) financial plans are drawn up when two or more companies merge (merger) into one or when one or more structural units join this company. Dividing financial plans are drawn up at the time of division of the company into two or more companies or when one or more structural units of this company are separated into another. Liquidation financial plans are drawn up at the time of liquidation of the company. The reasons for liquidation may be bankruptcy, closure due to reorganization.

EXAMPLE 1

LLC "Static" has drawn up a financial plan, in which certain planned indicators are fixed. This financial plan does not provide for changes in indicators due to changes in any external or internal conditions. Such a financial plan will be static.

In Dinamik LLC, the financial plan contains various options for the values ​​​​of indicators, depending on what situation will actually be implemented. That is, with an increase in sales of products by 20%, some indicators and a development option are planned, with an increase of over 40%, other indicators and a development option, etc. In fact, the dynamic financial plan of this enterprise will be a set of static financial plans.

Dynamic plans more informative, but compiling them is more difficult than static ones. If in static financial plans one version of the situation is developed, then in dynamic financial plans - two or more. Accordingly, the complexity and laboriousness of compilation increase proportionally.

According to the volume of information, plans can be single and consolidated (consolidated). Single plans display the strategy for one company. Summary (consolidated) plans constitute an action strategy for whole group companies. Such financial plans are most often drawn up when we are talking about a group of companies controlled by one person or group of persons. For the purpose of compiling financial plans can be divided into trial and final.

Trial Plans are compiled in order to implement control, analytical procedures. Trial plans are not shared with interested users as they are documents internal control and analysis. final plans are official documents of the company and serve as sources for various interested users to study its financial plans.

Usersfinancial plans can be:

• tax authorities;
• statistical bodies;
• creditors;
• investors;
• shareholders (founders), etc.

According to user information plans will be divided into plans submitted to the fiscal authorities, statistics authorities, creditors, investors, shareholders (founders), etc. By the nature of the activity plans can be divided into plans for core and non-core activities. Previously core business called the types of activities specified in the charter of the enterprise. But at present, this approach is unwise. The distinction between the main and non-main activities is possible on the basis of revenue indicators.

EXAMPLE 2

Revenue from type of activity No. 1 - 18,000,000 thousand rubles, from type of activity No. 2 - more than 1,000,000 thousand rubles.

Revenue from type of activity No. 1 will be more than 94% of all revenue (18,000,000 / (18,000,000 + 1,000,000)). The main activity for the company in this case will be activity No. 1.

At the same time, the distinction between core and non-core activities can also be made on the basis of other indicators (in particular, the amount of income from various types of activities).

Suppose the profit from activity No. 1, despite such serious gross revenue indicators, is only 300,000 thousand rubles. , and from the type of activity No. 2 - 800,000 thousand rubles. In this case, the main activity for the company will be activity No. 2.

The classification of activities into core and non-core is a rather subjective process and depends on the direction of the company's management.

When planning long-term investments and sources of their financing, future cash flows are considered from the perspective of the time value of money, based on the use of discounting methods to obtain commensurate results.

With the help of a cash flow forecast, you can assess how much of the latter you need to invest in the economic activities of the organization, the synchronism of the receipt and expenditure of finance, and also check the future liquidity of the enterprise.

The forecast of the balance of assets and liabilities (in the form of a balance sheet) at the end of the planning period reflects all changes in assets and liabilities as a result of planned activities and shows the state of property and finances of an economic entity. The purpose of developing a balance forecast- determination of the necessary increase certain types assets with ensuring their internal balance, as well as the formation of an optimal capital structure that would provide sufficient financial stability organizations in the future.

Unlike the income statement forecast, the balance sheet forecast reflects a fixed, static picture of the company's financial balance. Exist several methods for making a balance forecast:

1) methods based on the proportional dependence of indicators on sales volume;

2) methods using mathematical apparatus;

3) specialized methods.

The first of them consists in the assumption that balance sheet items that depend on the volume of sales (stocks, costs, fixed assets, receivables, etc.) change in proportion to its change. This method is also called percentage of sales method.

Among the methods using the mathematical apparatus, the following are widely used:

• simple linear regression method;
• non-linear regression method;
• multiple regression method, etc.

Specialized methods include methods based on the development of separate predictive models for each variable. For example, receivables are evaluated according to the principle of optimizing payment discipline; the forecast of the value of fixed assets is based on the investment budget, etc.

EXAMPLE 3

Let's consider financial planning of profit by a direct method. The procedure of this method is based on the assumption that the change in the need for funds for the manufacture of products is proportional to the dynamics of sales. Let us illustrate the essence of the direct method of financial profit planning (Table 2).

Table 2. Profit and loss statement
Indicator	During the reporting period	Forecast for next year(with an increase in sales volume by 1.5 times)
Revenue (net) from the sale of goods, products, works, services (net of VAT, excises and similar obligatory payments)		500 × 1.5 = 750
Cost of sold goods, products, works, services		400 × 1.5 = 600
Gross profit
Selling expenses
Management expenses
Profit (loss) from sales
Interest receivable
Percentage to be paid
Other income
other expenses
Profit (loss) from financial economic activity
Profit (loss) before tax
income tax
Profit (loss) of the reporting period (net)

An increase in sales by 50% affects many indicators. It is assumed that the cost of goods sold, as well as commercial expenses, will change in direct proportion to the growth rate of sales, but interest on loans depends on the financial decisions made.

One of the planning documents developed by the organization as part of long-term planning is business plan. It is developed, as a rule, for 3-5 years (with a detailed study of the first year and an enlarged forecast for subsequent periods) and reflects all aspects of the production, commercial and financial activities of the organization.

The most important part of a business plan is financial plan, summarizing the materials of all previous sections and presenting them in value terms. This section is necessary and important for businesses, as well as for investors and lenders. After all, they must know the sources and amount of financial resources required for the implementation of the project, the direction of the use of funds, the final financial results of their activities. Investors and creditors, in turn, should have an idea of ​​how cost-effectively their funds will be used, what is the payback period and return.

The current financial plan is a plan of income and expenses for the current year, which provides a certain level of profitability of the enterprise, as well as sources of formation and directions for spending funds.

It is a guideline for financial work enterprise in the planned year.

The current financial plan is drawn up for a year with a quarterly differentiation of its indicators. It enables the enterprise to form the structure of its income and expenses, determine the sources of financing for its development for the current period, ensure solvency, and also determine the structure of assets and capital at the end of the planning period.

The system of current planning of the enterprise activity provides for the development of such financial plans:

Income and expenses from operating, financial and investment activities;

Receipts and expenditures of funds;

Balance of monetary resources.

In addition to the above, enterprises for internal use can draw up a cash resource plan for financing current assets and an investment plan.

Plan of income and expenses from operating, financial and investment activities aims to determine the amount net profit from the business activities of the enterprise.

In the process of drawing up this plan, the following main indicators are planned:

Net income from sales of products (goods, works, services);

Other income from operating activities (for example, income from the lease of fixed assets);

Operating expenses (administrative, distribution and other operating expenses)

Equity income (income received from investments in associates, subsidiaries or joint ventures);

Other financial income (dividends, interest and other income received from financial investments);

Other income (income from the sale of financial investments, income from non-operating foreign exchange differences)

Finance costs (costs of interest and other expenses of the enterprise related to borrowing)

Equity expenses (loss on investments in associates, subsidiaries or joint ventures);

Income tax expense.

Plan of receipts and expenditures of funds implies determining the volume and need for financial resources for the implementation of planned operating expenses and investment programs, as well as the possibility of receiving these resources in the course of economic activity. It makes it possible to control the provision of constant solvency of the enterprise at all stages of the planning period.

The preparation of this plan involves the planning of the following main indicators:

1. As a result of operating activities:

1.1. Proceeds from:

Sales of products (goods, works, services);

Refund of taxes and fees;

Target financing;

Other receipts.

1.2. Spending on:

Payment for goods (works, services), labor;

Deductions for social events;

Obligations for taxes and fees;

Other spending.

2. As a result of investment activity:

2.1. Proceeds from:

Implementation of financial investments, non-current assets; - deducting interest, dividends; derivatives;

Other receipts.

2.2. Spending on:

Acquisition of financial investments, non-current assets;

Derivative payouts;

Other payments.

3. As a result of financial activity:

3.1. Proceeds from:

Equity;

Getting loans;

Other receipts.

3.2. Spending on:

Redemption of own shares;

Repayment of loans;

payment of dividends;

Other payments.

A guideline for drawing up a plan of receipts and expenditures of funds can be taken from the form of the Statement of cash flows by the direct method.

Generalized balance of cash resources at the end of the planning period is the final document of the current financial plan. It reflects all changes in assets and liabilities as a result of planned activities, shows the state of the enterprise's assets, determines the necessary increase in their individual types, ensuring their internal balance, as well as the formation of an optimal capital structure that would guarantee sufficient financial stability of the enterprise in the future.

Today, when enterprises (except state-owned) have been granted independence in planning, they may not conduct financial planning or conduct it in an arbitrary form that they consider most acceptable to them. Reference forms of financial statements can be taken, including for the plan of income and expenses from operating, financial and investment activities - the form of the Statement of financial results, the plan of receipts and expenditures of funds - the form of the Statement of cash flows by the direct method, the Balance of cash resources - the form of the Balance (Report on financial position), the articles of which the enterprise can supplement, reduce or change in accordance with the needs of planning and the specifics of its activities.

Send your good work in the knowledge base is simple. Use the form below

Good work to site">

Students, graduate students, young scientists who use the knowledge base in their studies and work will be very grateful to you.

Similar Documents

Essence, tasks and methods of financial planning. Methods used in the practice of financial planning. Process and stages of financial planning. Types of financial planning: long-term, current, operational financial planning.

term paper, added 01/29/2003


Financial planning in commercial organizations, principles, stages, types: perspective, current and operational. Analysis of the financial and economic activities of LLC "Flexilodzhik", development of recommendations for improving financial planning in it.

thesis, added 11/23/2012


The importance of financial planning of the enterprise in its economic activity. The main types of financial plans. Operational, current and long-term planning at enterprises. Development of a fragment of the financial plan for the quarter of a particular enterprise.

term paper, added 12/07/2013


Basic systems of financial planning. Perspective financial planning. System of current planning of financial activity. System of operational planning of financial activity. Financial planning at domestic enterprises.

abstract, added 05.10.2008


Theoretical basis, essence, tasks, types and functions of financial planning in the enterprise. Evaluation of the financial plan and analysis of financial indicators based on the budget of income and expenses, characteristics of production and economic activities.

thesis, added 11/17/2010


Fundamentals of financial planning in enterprises, principles and objectives, methods and types. Financial plan as an integral part of a business plan, types advanced planning. Current planning and use of the sales forecast method, practical aspects.

term paper, added 10/13/2009


Financial planning and its role in the economic activity of the enterprise. Goals, objectives, main indicators in financial planning and methods for their calculation. Balance of financial indicators, internal and operational financial planning.

term paper, added 03/02/2010

The basis of financial planning in the company is financial forecasting, which is based on determining the possible volume of sales and the corresponding costs. Financial planning includes the preparation of strategic, current and operational plans and, accordingly, the preparation of general, financial and operational budgets.

Strategic plans are plans for the general development of the business and, taking into account the financial aspect, determine the volume and structure of financial resources necessary for the preservation and development of the company. The strategic financial plan is focused on achieving the most important financial indicators, characterizes investment strategies and opportunities for reinvestment and accumulation of the company.

Current plans are built by decomposing the goals of the strategic financial plan from the macro level to the micro level. In other words, if the strategic financial plan characterizes the priority areas for investing and borrowing financial resources and the prospects for changing the capital structure, then the current financial plans detail these areas, linking various sources resources with each type of investment, evaluating the effectiveness of each of the sources, and also give a financial assessment of each of the company's activities.

Operational plans are short-term tactical plans and reveal certain aspects of the company's activities, taking into account strategic goals.

The budgeting process is the process of determining the future actions of the company in the formation and use of financial resources. The budget period usually covers a short period (up to a year), however, as part of the development of a financial strategy, the budget is drawn up for a longer period, equal to the period strategic planning. When drawing up long-term budgets, the company's financial activity is modeled, and its result is the development of target financial indicators that the company plans to achieve at the end of the strategic period. The final documents in the development of long-term strategic budgets are the profit and loss statement, the forecast balance sheet and the cash flow statement. When developing short-term budgets, more detailed planning of economic activities takes place, as a result of which adjustments can be made to strategic budgets. Operational budgets are included in the general annual (quarterly) budget of the company. The overall budget of a company usually consists of an operating budget, which includes the budget for sales, production, procurement of materials, selling expenses, etc., and a financial budget, which includes an investment budget, a cash budget, and a forecast balance sheet.

The main idea implemented in the budgeting system is to combine centralized management at the level of the entire company and decentralized management at the level of structural divisions taking into account the overall development strategy.

The starting point in building a long-term strategic budget is forecasting the volume of sales for the strategic period. When identifying trends in the development of the company, it is necessary, on the basis of actual data for the periods preceding the forecast, to establish the patterns of its development. For this, the financial statements of the enterprise and a wide variety of information, including marketing information, are used.

Sales volume forecasting is very important point because the consequences of an unreliable forecast can be very serious. First, if the market expansion occurs in large sizes than planned by the company, and its development will be accelerated, the company may not be able to satisfy the needs of its customers. On the other hand, if the forecasts are over-optimistic, it may turn out that the company has excess capacity, which means low level business activity and return on equity. Thus, accurate forecast sales volume is critical to a company's well-being.

Statistical methods can be used to predict sales volumes. In this case, the resulting forecast is the baseline and can be further adjusted taking into account external environment and other factors. Statistical models are convenient to use for forecasting sales in the context of the year by months in order to form operational budgets.

Example 1

Consider the tool p predicting the levels of a series of dynamics based on a multiplicative model.

The results of the activities of one of the companies within the Energocent holding were taken as the initial data. The company has been selling rolled metal in Russia since 2002. The initial data reflect the dynamics of rolled metal shipment in tonnage in 2003-2005. (Table 1).

Goals this study stem from the task of developing an operational budget:

1. Make a forecast for the shipment of rolled metal products for 2006, broken down by months, based on a multiplicative model. For this you need:

• determine the period for building a multiplicative model;
• select the type of trend equation;
• build a trend, check the significance, interpret the data.

2. Analyze a series of dynamics for the presence of seasonality. Calculate seasonal indices.

3. Build a forecast of trade turnover for 2006, taking into account the seasonality factor.

Table 1. Trade turnover dynamics in 2003–2005 in tonnage

Month
January
February
March
April
June
July
August
September
October
November
December

All calculations and plotting were carried out using the Excel package: Service - Data Analysis - Regression.

Rice. 1. Graph of the dynamics of trade turnover for 2003–2005.

At the first stage of the analysis of the time series, a data graph was plotted and their dependence on time was revealed (Fig. 1).

It follows from the study that the trade turnover in 2003-2005. has a long-term upward trend.

According to fig. 1 linear regression equation has the following form: Y \u003d 29.447x + 967.87. This means that every month the turnover increases by 29.447 tons.

Since our time series consists of values ​​measured monthly, the seasonal component should be taken into account. The calculation of seasonality indices is presented in Table. 2.

Table 2. Calculation of seasonality indices by months

Month										Seasonal indices, %	Chain growth rates of seasonality indices, %
	actual value	theoretical value		actual value	theoretical value	Y f / Y t	actual value	theoretical value	Y f / Y t
January
February
March
April
June
July
August
September
October
November
December

Rice. 2. Diagram of indices of seasonality of trade turnover

The totality of the calculated seasonality indices characterizes the seasonal wave of turnover in intragroup dynamics. To get a visual representation of the seasonal wave, the data obtained are shown in the form of a radar diagram (Fig. 2).

The next step was to calculate the turnover taking into account the trend and seasonality and build a model based on these data (Fig. 3).

Rice. 3. Model of turnover taking into account the trend and seasonality

Then a forecast was made of the company's turnover by months, taking into account the seasonal component for 2006. The results of the forecast are presented in Table. 3 and in fig. 4.

Table 3. Trade turnover forecast for 2006 Rice. 4. Schedule of forecasted trade turnover in 2006

Month	Turnover, t
September

Based on the calculation results, one can following conclusions.

Insofar as economic conditions change over time, managers must anticipate the impact these changes will have on the company. One of the methods to ensure accurate planning is forecasting. In the example, a quantitative forecasting method was used through time series analysis. The main assumption underlying the analysis of time series is as follows: the factors that affect the object under study in the present and the past will also affect it in the future.

As can be seen from the turnover dynamics model, the time series has a trend. However, actual figures fluctuate considerably. This is because the trend is not the only component of the time series. In addition to it, the data have factors that form seasonal changes levels of a series of dynamics and random factors.

During the analysis of the turnover data, seasonal fluctuations were revealed. In this example, the largest peak of the seasonal wave falls on the third quarter of the year. During this period, the company has the largest sales volume. Having predicted the turnover of rolled metal products for 2006, we can assume that the smallest shipment volumes are expected in January-February, and an increase in volumes - in July-September.

Fluctuations in turnover should be reflected in the operating budgets of the company and primarily in the sales budget. Based on the forecast described above, the company needs to develop a set of measures aimed at increasing sales during the period of seasonal reductions in turnover by providing discounts, holding special promotions, etc. sales volumes.

When developing a company's strategic budget, it is necessary to calculate the achievable amount of revenue for each year of the strategic period. To do this, you need to forecast sales by years until the turn of the strategic period, and then determine whether the company is able to achieve the forecast volume using internal potential without raising additional capital.

If the company is operating at full capacity and its capital structure matches the target, then an acceptable sales growth rate can be found using the formula:

g = (Rb(1 + ZK/SK)) / (А/S – Rb(1 + ZK/SK)),

where g - acceptable growth rate of sales volume;

R - projected net margin (ratio of net profit to sales volume);

b - profit reinvestment ratio (increase of retained earnings to net profit or one minus the dividend payout rate);

ZK/SK - the target value of the ratio of borrowed and equity capital;

A / S - the ratio of the amount of assets to the volume of sales.

Example 2

In the process of developing a financial strategy in the holding company Energocenter, using the DuPont formula, the main financial indicators were predicted and balanced: The net margin was determined at the level of 4.36%; set the dynamics of changes in asset turnover based on the average annual growth rate; the dynamics of dividend payments determined by the owner is taken into account; assets and other indicators are predicted (Table 4).

Table 4. Forecast of key financial indicators up to 2010

Schematic DuPont
Net profit
Equity
net margin
Asset turnover
ROA(on net income)
Leverage
Dividends
Payout ratio
Retention percentage

Let us calculate an acceptable sales growth rate for 2008 based on 2007 data, taking into account the following assumptions: relative indicators in 2008 will remain at the level of 2007, the current structure of the asset and liability of the balance sheet is optimal, depreciation charges are fully used to replace retired equipment:

g \u003d (0.0436 x 0.99 x (1 + 85 297 / 158 542)) / (243 839 / 1 219 196 - 0.0436 x 0.99 x (1 + 85 297 / 158 542) \u003d 0.497 \u003d 49.7%.

Thus, without changing the main financial indicators, the company can achieve revenue in 2008 in the amount of 1,825,136 thousand rubles. (1219196 × 1.497).

If sales growth rates turn out to be higher than acceptable, the company will need to raise additional capital, change the ratio between equity and borrowed funds, reduce the dividend payout rate, or adjust the rate of revenue growth.

If the growth rate of sales volume is lower than possible, then the company will receive a profit greater than its investment needs, and in this case, its financial plans should provide for an increase in the amount of cash on accounts and securities, a decrease in the share of borrowed capital, investments in non-current assets, an increase in dividend payments. In our example, this is exactly the case: in fact, in 2008, the planned sales volume is 1,540,305 thousand rubles. In its financial strategy, the holding company Energocenter plans to increase the share of cash and short-term financial investments in current assets, real and long-term financial investment, and also increase the dividend payout rate in 2008 to 25%. At the same time, when modeling key financial indicators for 2008, the structure of assets and liabilities was changed, and the net margin remained at the same level.

Based on 2008–2010 data. the same situation is observed: the planned sales volume for the years is lower than possible, which is reflected in the formed financial goals of the company.

g 2008 \u003d (0.0449 x 0.75 x (1 + 93 843 / 181 211)) / (275 054 / 1 540 305 - 0.0449 x 0.75 x (1 + 93 843 / 181 211)) \u003d 0.405 = 40.5%,

g 200 9 \u003d (0.0463 x 0.6 (1 + 77 357 / 222 871)) / (300 228 / 1 861 413 - 0.0463 x 0.6 x (1 + 77 357 / 222 871)) \u003d 0.302 = 30.2%,

g 20 10 \u003d (0.0476 x 0.6 x (1 + 50 699 / 270 260)) / (320 959 / 2 182 522 - 0.0476 x 0.6 x (1 + 50 699 / 270 260)) = 0.3 = 30%.

At the next stage, when the revenue is determined, an enlarged forecast balance of the company is compiled for each year for the period of strategic planning. In practice, for planning each balance sheet item, a forecasting method is often used, based on the percentage change in balance sheet items in relation to the volume of sales. The essence of this method is to determine those balance sheet items that change in the same proportion as the volume of sales. However this method has some limitations, expressed in terms of targets defined in the framework of the company's financial strategy.

Let's return to our example (Table 4). For the strategic period, using the DuPont formula, the main financial indicators were determined: net profit, assets, equity and borrowed capital. The amount of non-current assets is set taking into account the investment plan in fixed assets, current assets are calculated on a residual basis. In its activities, the company will not use long-term loans, and will use its own and short-term borrowed capital to finance current needs.

In accordance with the strategic development program, taking into account external and internal environment, and using a percent-of-sales model, the company determined the following:

• The share of non-current assets in the balance sheet totals 47%.
• The share of fixed assets in the structure of non-current assets will reach 80% by the end of 2010.
• Long-term financial investments should be from 15 to 17% of the total value of non-current assets.
• Stocks and costs - about 6% of the total current assets.
• The receivables turnover period will decrease by the end of the strategic period to 12 days.
• The share of cash and short-term financial investments will be about 50% of current assets, while the amount of cash is projected at 15-18% of the total current assets.
• The company will not create reserves for the strategic period.

Forecast balance sheet until 2010 with details of individual articles is presented in Table. 5.

Balance item
I. NON-CURRENT ASSETS
Intangible assets
fixed assets
Construction in progress
Profitable investments in material values
Long-term financial investments
Deferred tax assets
Other noncurrent assets
Total for Section I
II CURRENT ASSETS
Stocks and Value Added Tax on Purchased Valuables
Accounts receivable (for which payments are expected more than 12 months after the reporting date)
Accounts receivable (for which payments are expected within 12 months after the reporting date)
Short-term financial investments
Cash
Other current assets
Total for Section II
III. CAPITAL AND RESERVES
Total for Section III
IV. LONG TERM DUTIES
Total for section IV
V SHORT-TERM LIABILITIES
Loans and credits
Accounts payable and Other current liabilities
Debts to participants (founders) for payment of income
revenue of the future periods
Reserves for future expenses
Total for section VII
BALANCE (sum of lines 490+590+690)

Similarly, using the DuPont model and the percentage of sales model, a forecast profit and loss statement is compiled (Table 6).

Table 6. Forecast income statement

Indicator
Proceeds (net) from the sale of goods, products, works, services (net of value added tax, excises and similar obligatory payments)
Cost of sold goods, products, works, services
Gross profit
Selling expenses
Management expenses
Profit (loss) from sales
Other income and expenses Interest receivable
Percentage to be paid
Income from participation in other organizations
Other income
other expenses
Profit (loss) before tax
Current income tax and other similar obligatory payments
Net profit (loss) of the reporting period

At the next stage, the cash flow budget (ODBS) is formed using the indirect method, which includes data from the forecast balance sheet and income statement. Indirect ODDS discloses information on sources of financing - net profit and depreciation charges, changes in working capital ah, including those formed at the expense of own capital. In other words, indirect ODDS is focused on analysis cash flows companies.

At the last stage, an analysis of the forecasted economic activity of the company is carried out in the following areas: analysis of liquidity, profitability, business activity, financial stability. In case of unsatisfactory results of the analysis, the budget items are revised.

Example 3

We will analyze the business activity of the holding company Energocenter (Table 7) on the basis of the forecast balance sheet and income statement and draw conclusions regarding satisfaction with the calculated indicators.

Table 7. Analysis of the company's forecasted business activity

	Indicator				Changes (+, -) 08–09	Changes (+, -) 09–10
	Revenues from sales
	Net profit
	Return on assets of production assets
	Total capital turnover ratio
	Working capital turnover ratio
	Inventory turnover ratio (according to s / s))
	Average turnover period of receivables (in days)
	Accounts receivable turnover ratio
	Average turnaround time of material assets (in days)
	Accounts payable turnover ratio (according to c / c)
	Duration of accounts payable turnover
	Equity turnover ratio
	Operating cycle time (in days)
	Duration of the financial cycle (in days)

Having analyzed the business activity of the company predicted for the strategic period, we can draw the following conclusions: the efficiency of the use of fixed assets and other non-current assets will maintain a positive trend and amount to 14.83 by the end of the strategic period. The total capital turnover ratio will increase and reach 7.03 at the end of the period. The turnover ratios of working capital, inventories and costs will also maintain a positive trend. The average term of accounts receivable turnover at the end of 2010 will be 11.88 days against 23.33 days in 2006 due to tightening of the company's credit policy. The accounts payable turnover ratio will increase by 22.14 and amount to 31.36 at the end of 2010; the duration of accounts payable turnover will be reduced and will amount to 11.64 days. By increasing the efficiency of the use of assets, the company will be able to increase its solvency and, accordingly, improve payment discipline when working with creditors, which will directly affect the duration of the accounts payable turnover. At the end of the strategic period, a slight decrease in the equity turnover ratio is expected - by 0.22 points. The operating cycle has decreased by 13.31 days and will amount to 13.65 days. The financial cycle will grow and reach 2.01 days by the end of 2010.

Thus, it can be concluded that business activity company is satisfactory.

Forward-looking financial planning determines key indicators, proportions, the rate of expansion of reproduction and is the main form of implementation of the company's strategic goals. Long-term financial planning, as a rule, covers a period of one to three years, less often up to five years. It includes the development of the financial strategy of the company and the modeling of financial activities. Financial strategy is the definition of long-term financial goals and the choice of the most effective ways their achievements. Modeling includes forecasting the financial performance and financial condition of the company on long term and forecast of key financial indicators.

As the analysis of the theory and practice of management shows, the implementation of the financial strategy is facilitated by the implementation and use of an integrated controlling system in the company. AT general view controlling includes setting goals, collecting and processing information for adoption management decisions, implementation of the functions of operational control of deviations of the actual performance of the company from the planned ones, their evaluation and analysis, as well as the development options management decisions. One of the main controlling tools is the budgeting mechanism, which is a complex process that includes planning, accounting and control of financial flows and the results of the implementation of the financial strategy.

The system of current planning of the financial activity of the company is based on the developed financial strategy and financial policy for certain aspects of financial activity. This type financial planning is to develop specific types of current financial plans that enable the company to determine for the coming period all sources of financing for its development, form the structure of its income and costs, ensure its constant solvency, and also determine the structure of assets and capital of the company at the end of the planning period.
The result of the current financial planning is the development of:
- cash flow plan;
- the plan of the report on profits and losses;
- balance sheet plan.
The main purpose of constructing these documents is to evaluate financial position firms at the end of the planning period. The current financial plan is drawn up for a year, broken down by quarters, since such periodization complies with legal reporting requirements. Current financial plans entrepreneurial firm are developed on the basis of data that characterize:
- Financial strategy of the company;
- results financial analysis for the previous period;
- planned volumes of production and sales of products, as well as other economic indicators of the company's operating activities;
- a system of norms and standards for the costs of individual resources developed at the company;
the current system taxation;
- the current system of norms depreciation charges;
- average rates of credit and deposit interest in the financial market, etc.
To draw up financial documents in the process of current financial planning, it is important to correctly determine the volume of future sales (volume of sales). It is necessary for the organization production process, efficient allocation of funds. As a rule, sales forecasts are made for three years, the annual forecast is divided into quarters and months, while the shorter the forecast period, the more accurate and specific the information contained in it. The sales volume forecast helps to determine the impact of production volume, the price of products sold on the financial flows of the company. The forecast of sales volumes for a specific type of product can be presented in the form of a table (Table 10.2).
Table 10.2
Sales forecast for 2001

Based on the sales forecast data, the required amount of material and labor resources is calculated, and other component production costs are also determined. Using the data obtained, a planned profit and loss statement is developed, with the help of which the amount of profit received in the upcoming (planned) period is determined.

Table 10.3

Profit and loss plan
Name of indicator	Page code	Planned period
		1 sq.	II quarter.	III quarter.
Revenue from product sales (net of VAT and excises)	010
Cost of goods sold	020
Selling expenses	030
Management expenses	040
Profit (loss) from sales (lines 010 - 020 - 030 - 040)	050
Interest receivable	060
Percentage to be paid	070
Income from participation in other organizations	080
Other operating income	090
Other operating expenses	100
Profit (loss) from financial and economic activities (lines 050 + 060 - 070 + 080 + + 090 - 100)	110
Other non-operating income	120
Other non-operating expenses	130
Profit (loss) of the planned period (lines 110 + 120 - 130)	140
income tax	150
Abstract funds	160
Undistributed profit (loss) of the planned period (lines 140 - 150 - 160)	170

Particular attention in drawing up the plan of the profit and loss account is given to determining the proceeds from the sale of products. As a rule, the value of sales proceeds for the previous year is taken as the starting point. This value is determined in the current year, taking into account changes:
- cost of comparable products;
- prices for products sold by the company;
- prices for purchased materials and components;
- evaluation of fixed assets and capital investments of the company;
- remuneration of employees of the company.
The planned average annual amount of depreciation is determined on the basis of data on the average annual book value of fixed assets and depreciation rates.
Cost planning by responsibility centers is carried out by developing a cost matrix, which includes:
- dimension of the center of responsibility, i.e. an indication of the department in which this cost item occurs;
- dimension of the production program, i.e. indication of the purpose of the occurrence of this cost item;
- the dimension of the cost element, i.e. specifying the type of resources used.
As a result, when summing up the costs in the cells by the rows of the matrix, planned data on responsibility centers are obtained.
A cash flow plan is developed that takes into account cash inflow (receipts and payments), cash outflows (costs and expenses), net cash flow (surplus or deficit). In fact, it reflects the movement of cash flows for current, investment and financial activities. Differentiation of activities in the development of a cash flow plan can improve the effectiveness of cash flow management in the process of carrying out the financial activities of the company.
The cash flow plan is compiled for the year, broken down by quarters and includes two main parts: receipts and expenses. The income section reflects proceeds from the sale of products, from the sale of fixed assets and intangible assets, income from non-sales operations and other income that the company expects to receive during the year.
The expenditure part reflects the costs of production of sold products, the amount of tax payments, the repayment of long-term loans, the payment of interest for using a bank loan, the directions for using net profit

Table 10.4
Cash flow plan for 2001

Sections and balance sheet items	Planned period
	year		1 sq.		II quarter.		III quarter.		IV quarter.
1	2		3		4		5		6
Income
1. From current activities Section 2 total 3. From financial activities 3.1. Increase the authorized capital 3.2. Increasing debt 3.2.1. Obtaining new loans and credits 3.2.2. Bond issue Section 3 Total
1.1. Proceeds from the sale of products, works, services (without VAT, excises and customs duties)
1.2. Other supply:
Section 1 Total
2. From investment activities
2.1. Revenue from other sales excluding VAT
2.2. Income from non-operating operations
2.3. Income from securities
2.4. Income from participation in the activities of other organizations
2.5. Savings for construction and installation work performed by an economic method
2.6. Funds received in the order of equity participation in housing construction
Total receipts
Expenses
1. According to current activities
1.1. Production costs of sold products (excluding depreciation and taxes charged to the cost of production)
1.2. Payments to the budget
1.2.1. Taxes included in the cost of production:
1.2.1.1 Income tax
1.2.2.2. Taxes paid out of profits remaining at the disposal of the firm
1.2.2.3. Taxes attributable to financial result
4. Tax on other income
5. Payments from the consumption fund (material assistance, etc.)
6.Increase in own working capital
Section 1 Total
2. For investment activities
2.1. Investments in fixed assets and intangible assets
2.2..Capital investments for industrial purposes
2.3.Capital investments for non-production purposes
2.4. R&D costs
2.5. Payments for leasing operations
2.6. Long-term financial investments
2.7. Expenses from other sales
2.8. Expenses on non-operating transactions
2.9. Object content social sphere
2.10. other expenses
Section 2 total
3. Financial activities
Repayment of long-term loans
Payment of interest on long-term loans
other expenses
Short-term financial investments
Payment of dividends
Contributions to the reserve fund
Section 3 Total
Total expenses
Excess of income over expenses
Excess of expenses over income
Current activity balance
Investment activity balance
Balance on financial activities

The balance plan, as a rule, is built according to the following scheme:
1. Assets:
Current assets
Fixed Assets
2. Liabilities and equity of the firm:
Long term duties.
Short-term liabilities
3. Total liabilities
4. Equity of the firm
5. Total liabilities and equity of the firm

With the help of such a cash flow plan, the company, when planning, covers the entire turnover of funds, which makes it possible to analyze and evaluate cash receipts and expenditures and make prompt decisions on possible financing methods in the event of a shortage of these funds. In this case, the plan is considered to be finalized if it provides for sources to cover a possible shortage of funds.
The final document of the current annual financial plan is the planned balance of assets and liabilities (in the form of a balance sheet) at the end of the planning period, which reflects all changes in assets and liabilities as a result of planned activities and shows the state of property and finances of the entrepreneurial firm. The purpose of developing a balance plan is to determine the necessary increase in certain types of assets, ensuring their internal balance, as well as the formation of an optimal capital structure that would ensure sufficient financial stability of the company in the future period.
The balance sheet serves as a good check on the profit and loss plan and cash flow. In the process of its compilation, the acquisition of fixed assets, changes in the value of inventories are taken into account, planned loans, issuance of shares and other securities, etc. are noted.
The process of current financial planning is carried out at the firm in close connection with the process of planning its operations.

More on the topic Current financial planning:

1. 7.2. Financial planning 7.2.1. The role and objectives of financial planning
2. FINANCIAL PLANNING OF ORGANIZATIONS (ENTERPRISES) Fundamentals of organizing financial planning
3. Lecture No. 29 Topic: Financial planning. Business planning
4. Chapter 11 TYPES AND METHODS OF FINANCIAL PLANNING AND FORECASTING. BUDGETING AS A NEW MANAGEMENT TECHNOLOGY OF PLANNING AT THE ENTERPRISE
5. Analysis of financial activity as a tool for managing financial planning
6. Financial strategy and its role in managing financial planning
7. MONITORING OF CURRENT FINANCIAL ACTIVITIES
8. Choosing a policy for the integrated operational management of current assets and current liabilities
9. The main types of current financial plans developed at the enterprise are:
10. 11.4. Financial forecasting and its role in financial planning
11. Net working capital and current financial needs of the enterprise
12. 44. Analysis of cash flows from the current, investment and financial activities of the organization
13. An in-depth analysis of own working capital - and current financial needs
14. Chapter IV Financial planning and forecasting of financial statements
15. 7. FINANCIAL WORK AND FINANCIAL PLANNING IN THE ENTERPRISE MANAGEMENT SYSTEM