General Inquiries

Rolling 12 budgets?

  • 1.  Rolling 12 budgets?

    Posted 12-07-2018 11:34
    ​We are contemplating whether we should implement a rolling 12 budget instead of the once a year budget that we do now.  Wondering who out there is using rolling 12 budgets, what you have found for benefits and even the challenges of implementing (system or otherwise).

    Thanks for any responses!

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    Ron Heemstra
    Controller
    Interstates
    Sioux Center IA
    (712) 722-1662
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  • 2.  RE: Rolling 12 budgets?

    Posted 12-08-2018 12:08

    Ron,

    We also incorporate Rolling 12's into our financial reporting and budgeting.  I generally build my projections on a calendar basis, but I then link these schedules to quarterly versions that compare our current period

    just ended 12 months to the comparable prior period and then to the anticipate next 12 month period (ie compare 12 mo's ended 9/30/18 with 9/30/17 and projected 9/30/19).  This does require you to have some sort of rough future budget for the next year (ie you would need to have 2020's budget prepared once you report Q1 2019, but I typically make that second year out more based on typical flow than an actual backlog.  Making the initial templates can be time consuming but i do think reporting on rolling 12's is much more telling than looking at a single month or quarter.

    I hope this is helpful.



    Patrick Lloyd

    Chief Financial Officer

    – 205 327 6617

    – 205 283 8936

    creaturebuilds.com








  • 3.  RE: Rolling 12 budgets?

    Posted 12-10-2018 10:53
    Ron-  We've used a rolling 6 quarter budget for the last decade.  We find it an incredibly helpful tool to keep management forward looking.  The issue with the annual plan, is by September, you only have 3 months of plan built out in front of you.  When we went to the 6 quarters, we did all of the planning in Excel.  We then quickly built out a module in JDE to handle this for us.  Since then, we converted to CMiC and had this built out in FMW.  Excel is probably a good way to start out, until you work out the kinks.

    We had issues early on with adoption from some groups, but this was lead from the top down and non-compliance wasn't acceptable.  10 years later, this is part of our business and in the eyes of operations, this has gone from a corporate mandate, to groups embracing the process and using it as a key tool to run their business.​

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    Bradley Peterson CCIFP
    Vp, Corporate Controller
    Swinerton Incorporated
    Concord CA
    (415) 984-1283
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  • 4.  RE: Rolling 12 budgets?

    Posted 12-11-2018 20:20
    Ron,

    We do an annual budget with quarterly updates which includes adding an additional three months to get the rolling 12 budget and reporting. So by the time we get to the 4th quarter we have our next years annual budget.

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    Monty Anderson
    Finance Manager
    Tapani, Inc.
    Battle Ground WA
    (360) 687-1148
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  • 5.  RE: Rolling 12 budgets?

    Posted 12-12-2018 08:04
    Hello Ron.

    My background is 10+ years in Public Accounting/Consulting, and 10+ years in industry.
    The most valuable solution I have seen is a 12 and 24 month projection of the balance sheet and the income statement with cycled updates.
    This involves projecting well beyond backlog.  (I have never heard of a company not signing a contract for 24 months).
    This always keeps a projection at or beyond a year.
    At 12/31, the next year's budget is not only complete, but has been updated and discussed a number of times.

    Projecting the balance sheet allows for much greater financial management of the organization in my humble opinion.
    It also led to much learning.  We did this at my last employer for the past two years.  It is now embedded in the financial culture, and will remain.




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    Joseph Harper CPA, CCIFP
    Cfo
    Greater Dayton Construction Group
    Beavercreek OH
    (740) 607-1449
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