Forecast and Budgeting in RE

Our accounting department often asks us for a forecast of different sorts. How we generate them depends largely on what budget line we're talking about.



For instance, we have a separate budget line for grants. To create a pipeline report for grants, we look at what grant proposals are out there (we have the prospect module, so that info lives in the prospect tab) and make an estimate of what we expect the return to be. We all know that's a dodgy proposition, but we can get a ballpark number.



There's another budget line for bequests. For that one we'd gather up all "perpetual" recurring gifts (paid out on a schedule), then we'd take a 3 or 4 year trailing average of one time bequests we got in a particular month for each year, and add those two together. Again, it's a ballpark figure - nothing we can really bank on, but some data is better than no data.



The idea of doing a trailing average for a particular month seems like maybe the best approach for a given budget category. Not that we do this, but we could give a ballpark figure for what our direct mail campaign will bring in next month by doing that kind of average. Of course we would also bring in human level information as well (like the fact that our most recent mailing was delayed by 3 weeks) and revise that figure down.



As far as tracking your budget, so long as you know what budget line every gift is going to (usually this is tracked by fund, but we have a couple of budget line items that are tracked by appeal instead - we're weird), you can report on exactly what came in the door in any given month for every line of your budget as soon as you've processed all gifts for that month (so one or two business days after the month is over, if you're on top of your game). For us, this is a lot faster than accounting's monthly reports because they're much more meticulous and, of course, they're doing other work as well. 



To do this, I would create, say, a fund performance alanysis report that looks at the specific fund and/or budget that I want to report on and give it a date parameter of "last month" and run it as soon as all the gifts are processed. I have 5 such reports that I run every month, and they're usually bang-on with whatever accounting later reports. Discrepancies only occur if and when accounting discovers an error that I have to go back and correct, but of course after it's corrected, the numbers line up again.



Does this help? If it doesn't, let's get a little more detaild on exactly what you would like. Give me some examples and I may be able to help you out.

If you mean what was raised last year by a certain time you could use the comparitive report. If you mean overall budget, you could create a dashboard of last year at this time and compare it to this year. You just input your expenses under funds or appeals depending on how your data is housed. Change your time frames on each to start of fiscal year to month and day of the appropriate year and then you will have a side by side of budget and expenses. If you are forecasting grant income you would almost have to enter a pledge for the grants in advance.