As a governing body, budgeting is one of the key functions of a management committee. With the estimation of revenues and expenses, a budget forms the financial foundation of a housing complex which decides the allocation of funds towards various categories. Smart budgeting can help a society to cut costs, thereby increasing the allocation of resources towards key areas. Hence, one of the Treasurer’s main roles is to track budget variance and ensure optimisation.
What is Budget Optimisation?
Budget optimisation is the process of allocating funds in the most efficient manner to realise a desired objective, whether to reduce expenses or to improve the delivery of services. Budget variance is one of the important tools in achieving budget optimization. It is the process of periodically measuring the difference between budgeted and actual figures for a particular category, such as housekeeping.
Budget optimisation is also important to ensure cost management. By allocating an appropriate budget, a treasurer can put a ceiling on the expenditure for different categories, such as security, housekeeping, or renovations. However, its success depends on the availability of adequate allocation for each category. This is where budget variance plays an important role.
How does the ApnaComplex Budget Variance Report help in ensuring budget optimisation?
As a comparative measure, the objective of budget variance is to empower treasurers and financial controllers to improve their forecasts. A favourable budget variance indicates gains or profits while an unfavourable variance indicates a budget shortfall. The ApnaComplex Budget Variance Report is a revolutionary tool that digitises variance reports, enabling MC members to keep a constant track of their spending. This can help them to:
- Compare actual expenses with budgeted expenses at any given time.
- Track accuracy of forecast, improving its effectiveness over time.
- Put a cap on expenses when the report indicates overspending, thereby controlling overall expenditure.
- Identify areas that see consistent overspending
- Facilitate financial reporting and management
- Validate additional allocation of funds when required
- Identify areas that need better financial management
- Save time and effort by automating variance calculations
More ApnaComplex budgeting tools to improve optimisation
The ApnaComplex automated accounting function offers many other tools that can further help in improving cost optimisation. These include:
Removing chances of untraceable expenses: One of the challenges in managing the finances for a large complex is keeping a tab on various expenses. The billing and collection module in the accounting software mandates recording every financial transaction, removing chances of fraudulent or missed entries. This means that the MC, at any given point, can trace a detailed account of every expense.
Ensuring on-time collections: Timely collection of maintenance is vital in ensuring the society’s revenue streams. The GST-compliant Society Billing & Accounting feature by ApnaComplex completely automates the process of calculating and issuing notices for maintenance payments every month, ensuring on-time payments. It identifies and notifies defaulters, thereby reducing the chances of missing or incorrect payments. By automating all accounting functions, this feature also reduces the society’s accounting work by more than 80%.
Tracking expenses: With the Expense Tracker feature, the Treasurer can check expenses under each category. It is a vital tool in keeping a constant track of spendings as they occur.
Improving financial management: The fully automated accounting functions are designed to remove any chances of human error or fraud in financial transactions. The digitisation of the financial records allows for complete transparency of data where expenses can be tracked to the source. This data is vital in improving the financial management of the society by identifying areas of high expense, trace performance of assets, and help in cutting down on avoidable expenditure.
If you want to learn more about our budget optimisation tools, get in touch with us at support@apnacomeplex. Our team will help you understand the various features you can use for reducing costs and improving your balance sheet!
Leave a Reply