Key Drivers for ‘Predictive Accounting’
Business Advisory Services Updates
The key driver for utilising ‘Predictive Accounting’ is to clearly summarise the various “non-financial items” before attempting to produce a budget.
‘Predictive Accounting’ embraces a systematic approach to the preparation of budgets, starting with basic information relating to:
- The types of products to be manufactured.
- The targeted quantity of the various products to be produced daily.
- The labour time involved in the production of each type of product.
- The direct costs expected to be incurred on a daily basis for the various types of products.
- The labour cost for each product being produced.
- The supplier payment terms for the external purchases required for each product.
- The estimated total cost of the individual products.
- The estimated selling price for the various types of product.
- The estimated number of stockholding days required.
- The budgeted sales volume for the various products each week.
- The estimated number of days credit that credit customers will want.
