Summary
The administrator of a business related to A and B, in order to acquire and apply in practice the different techniques to prepare a budget in the operation of his establishment, it is necessary that he obtain the criteria to budget adequately under the specific requirements that the practical exercise Every day he asks you appropriately, adjusting to his real needs, as well as special cases.
Among the functions of an administrator it is necessary to constantly plan and then evaluate the progress of the strategy carried out, to execute and control the activities related to budgets, which can be interpreted in a quantifiable way. Giving support to the results of the business in each of the needs in operation of the business, knowing the main problems, handling basic criteria and budgeting techniques, which help us in a more adequate way to make a job decision.
Budget
The Budget is the main element to objectively evaluate the result of an A and B establishment, estimating to program and systematize each exercise throughout an established period, anticipating the results to be obtained, representing the goals to be achieved in the business, taking into account analysis that allows the inclusion of the quality elements that make a work environment possible and that makes it easy to do things right the first time.
A restaurant administrator can budget based on criteria such as:
- The objectives of the business. The expectations of the vision and the mission of the business. The previous results. The flexibility to modify what has been done. The criteria, techniques and experience.
Budget system process
Fig. 1. Budget system process.
- Formulate the budget (s), according to the administrator's objectives, criteria, techniques and experience. The budget is operated to guide the functional decision of the business, implementing tactics and strategies to achieve the objectives. The actual results are evaluated, comparing them against budgets, determining the degree of achievement achieved. Constant control. Annual reviews based on quarterly or semi-annual reviews.
The constant revision of the budgets and their comparison with the actual results, allow adjusting the operation in search of the stated objectives, strategically correcting the causes of any deviation that may affect the objective of the company.
Budget classification
There are different classifications of the budgets of which we can mention the following:
a) For its period or term:
- In the short term, in the medium term, in the long term.
b) Due to its importance:
- Financial situation, Income statement, Changes in financial situation, Sales, Costs, Purchases, Operating expenses, Cash flow.
Secondary or analytical:
- Sales by service, type of client, area, etc. Cost by type of service. Operating expenses. Purchase of land, premises, furniture and equipment.
c) Due to its origin and effects:
- Operational or economic (those that refer to the income statements). Financial: Cash flow. Payment program. Purchases. Inventories. Capitalized projects.
d) For its flexibility:
- Fixed allocation Flexible.
e) By the limit expressed:
- Maximum to achieve, Minimum to cover, Mixed (combines both).
f) By units it manages:
- Monetary: Numerical and graphics.
Large groups of budgets
Figure 2. Large groups of budgets.
Operation budget: Estimate the income statement for the operation of the restaurant in the budgeted period.
Financial budget: It is based on the balance sheet or statement of financial position.
Note: the manager always has to adjust appropriately to the purpose of the restaurant when making budgets.
The budget as a forecast of the future
The budgeting of the facilities allows predicting what will happen in the future, whether there will be a profit or a loss, thus being able to determine the necessary corrections and diversification routes that allow increasing the entity's efficiency. Many of the closings could have been avoided through a timely effort to quantify in monetary terms the objectives that were to be achieved. Based on this, a master budget plan can be drawn up that encompasses the financial and operations budgets, the latter being of vital importance since it is the one that covers the income and expenses of the current actions of the company,being the most frequently used and should be prepared based on the organizational structure of the entity and assigning to managers the responsibility of achieving the determined objectives, adapting to the real scenarios and conditions that the entity will face during the time.
In catering, the cost of food and its constant variation depends only on the relationship between the purchase price and the quantity of raw materials used in the preparation of an offer. take into account some factors that affect cost control, such as:
- Food Cost: Food is considered the largest item of controllable feasible expense and the most indeterminate within food operations. According to the different fluctuations in prices of edible products, which have increased in recent years, the sale price must be in accordance with the operating expenses depending on the type of service. more difficult to control than the cost of food. There are some influencing factors, such as: the type of service and the extent of the services offered; hours of service; the kind of menu; the physical plant; the size of the business, the arrangement of the preparation and service units; working conditions; the quantity, class and distribution of automatic equipment;the program and regulations on personnel selection; the training and the schedules of the employees of the improvement; (quantitatively and qualitatively); the salary scale; average employee turnover and standards to be maintained in production and services Other expenses: Control does not end with consideration of food and staff costs, one way or another on 12-18 % of the department's budget, they are used in other losses of fixed expenses such as: Laundry, toiletries, maintenance, office supplies, depreciations, etc.average employee turnover and standards to be maintained in production and services Other Expenses: Control does not end with consideration of food and staff costs, one way or another on 12-18 % of the department's budget, they are used in other losses of fixed expenses such as: Laundry, toiletries, maintenance, office supplies, depreciations, etc.average employee turnover and standards to be maintained in production and services Other expenses: Control does not end with consideration of food and staff costs, one way or another on 12-18 % of the department's budget, they are used in other losses of fixed expenses such as: Laundry, toiletries, maintenance, office supplies, depreciations, etc.
Budgeting occurs in the main financial statements, in order to anticipate a result in a future period of interest of the administrator, accountant or owner of a business of A and B, some more common examples of budget schedules are attached, applicable in all the cases to the characteristics and type of restaurants, adapting to the needs of the business.
Budget
What is the budget?
It is the quantified expression of the action plan and constitutes an adequate tool for the coordination and implementation of this production plan or process, economically valuing the quantities obtained in the metric computation for a given task, installation or service, in advance of its execution..
The Budget is the calculation and anticipated negotiation of the income and expenses of an economic activity (personal, family, a business, a company, an office, a government) during a period, generally on an annual basis, involving an action plan aimed at meeting a planned goal, expressed in financial values and terms that must be met in a certain time and under certain conditions, this concept is applied to each center of responsibility of the organization, as the instrument of annual development in companies or institutions whose plans and programs are formulated, carrying out an operations and resources plan in the company, to achieve in a certain period the proposed objectives that are expressed in monetary terms,just sit down to plan what you want to do in the future and express it in quantifiable numbers, to achieve in a certain time the displayed objectives and it is expressed in monetary terms.
Information concepts to consider when budgeting
- Suppliers.Quality and price.Prices of suppliers.Sales: They are generally prepared by months, geographical areas and products.Cost-Production: Sometimes this information is included in the production budget. When comparing the production cost with the sale price, it shows if the profit margins are adequate. Purchases: It is the budget that foresees the purchases of raw materials and / or merchandise that will be made during a certain period. Generally they are made in units and costs, the applicant participates who formulates the requirement of a good of both heritage and a good for consumption in the process of its activity within the institution. Income: Non-recoverable payments, with consideration and without she; except for non-compulsory, non-recoverable and non-paid entries,without consideration received from national or foreign governments and international institutions. Income appears net of refunds and other adjustment transactions. Expenses: Action of spending (spending money on something, deteriorating with use). In an economic sense, spending is known as the amount that is spent or has been spent. Spending is a concept of utility for both families, businesses or the government.
Budgets how they relate to the administrative process
The budget plays a fundamental role within an organization, so that through the administrative area accounting operations can be more easily inspected, which allows each of its members to have a general knowledge of the balance sheet, expenses and income presented by the sales and production of the company.
The budget and accounting have a certain relationship, it involves an accounting system where it serves as the basis for preparing budget reports; therefore, by controlling the results obtained and recorded by the accounting of the company, a general knowledge of the economic situation of the company can be achieved, through the balance sheet and the profit and loss statement; information requested by the administration to conduct activities and projects effectively.
In turn, accounting as an internal control instrument contributes to the data collection required by the budget to evaluate the performance of economic projections in previous periods. Therefore, an adequate accounting system guarantees a reliable and accurate financial budget; in such a way that the information provided by the accounting of an organization influences the decision-making by the executives that compose it, in relation to the goals to be achieved.
The budget is made according to the objectives that have been set, taking into account the planned means to reach them, it can be considered part of the classic administrative process that consists of planning to act and control (efficiently) human, technical and material resources, etc., that the company has. Budgets serve as a means of communicating the plans of any organization, providing the basis for evaluating the performance of the different segments or areas of activity of the company.
Why is it important that budgets are based on the concepts contained in financial statements?
- It allows us to know how much they spent, they saved, they invested, etc., which tends to translate into better planning for the following year. By evaluating the excessive expenses in some areas and the benefits in others, we can reflect and design better tactics to correct errors and take advantage of successes. Those who run a business allow them to know how profitable it is, and facilitate the possibility of annually comparing the real performance of the company. Individual users allow them to know how much they spent, saved, invested, etc., which It tends to translate into better planning for the coming year. By evaluating overspending in some areas and benefits in others, we can reflect and design better tactics to correct mistakes and take advantage of successes.For those who run a business, it allows them to know how profitable it is, and it makes it easier for them to compare the real performance of the company annually. These documents should be kept so that they can be compared with each other and know, with real numbers, which year was better. It must be remembered that the empirical perception is usually imprecise and leads to errors. It can help creditors and potential grantors of a financing to know how the finances of the user or company are, to determine the risk of the operation and the ability to payment.If a financial statement is good, it can help us get a good credit, mortgage or financing.Financial statements are important because they are serious and officially valid documents (as long as they are done with someone with the proper authorization) that allow you to have a very organized idea about finances.
Operation budget
One of the primary purposes of having a budget is that you can determine the income you intend to obtain in your business, as well as the expenses that will occur. So it is very important that such information is well detailed. They are estimated that directly in process has to do with the neurological part of the company, from the production itself, to the expenses that resist offering the product or service, are components of this item:
- Sales budget (estimates produced and in process). Production budget (includes direct and indirect expenses). Materials requirement budget (raw material, supplies, auto parts, etc.). Labor budget (brute, qualified and specialized force)) Budget manufacturing cost Budget production cost (without profit margin) Budget selling cost (training, sales, advertising) Budget administration cost (requirement of all kinds of labor and distribution of labor).
Financial budget
It is the one that deals with the financial structure of the company, that is, the composition and relationship that must exist between assets, liabilities and capital. Its objective is summarized in two factors: liquidity and profitability.
Composition of the financial structure:
- Cash on hand and banks and temporary investments. Accounts receivable from clients. Permanent investments. Short and long-term debts. Accounts payable to suppliers. Expenses and taxes payable. Social capital and retained earnings.
Planning is the key to good administration. This is true for individuals, family businesses, large corporations, government agencies, and nonprofits. For example, most successful students who earn good grades finance their education and earn their degrees because they plan their time, work, and recreation. These students are budgeting their meager resources to make the best use of time, money, and energy. Likewise, the owners and managers of small and large companies survive and grow even during economically difficult times, because they plan and budget their operations and the expansion of their facilities.
A dynamics of investigation in a class, where it requires the skills of each one of the team members, demands a plan from each one of its participants, keeping in mind the delivery in time and form established by the teacher, as conditioned by one of my groups from the Technological University of Cancun (GA37), obtaining in a short time the contributions that collaborated with this summary in an indirect way, the brainstorming that a group of students involved in gastronomy gives it more projection and support to research on costs and budgets in the area of food and beverages.
Budgeting requires a commitment from senior management to promote participation at all levels, an administrative process that organizes, provides, applies and controls resources, an organizational structure that identifies roles and responsibilities, a process of control and coordination of the functions, permanently, for this the concepts of the budgets and their relation to the financial statements must be very clear.
