Budget KPIs in key performance indicators of financial management.
1. Forecast accuracy of budget
Actual budget (costs) relative to the established budget.
2. Deviation of planned budget
The deviation of the planned budget (cost) is the difference in costs between the planned baseline against the actual budget.
3. Actual vs. budgeted costs
The actual costs relative to the budgeted costs of an activity.
4. Time by which Budget closed before the year end
The earlier it is closed & made available, the more time you get to discuss it out in detail & work out next year strategies sufficiently in advance before the year begins.
5. Days taken to close the budget
To benchmark against the previous budget as well as against the industry standard.
6. % of budget cuts achieved
Percentage of budget cuts achieved (measured in money) versus budget cuts planned (measured in money).
7. Number of years with a balanced budget
Number of years with a balanced budget.
8.Number of budget deviations
Number of budget deviations
List of KPI mistakes
Building KPI system plays an important role in evaluating job performance of individual parts, divisions and the company’s objectives and performance management system in general. The development of KPI metrics help to create measurement systems, information systems throughout the organization.
When building KPI system, you should note the following factors:
• Do not create too many KPI, KPI be built around 3-5 KRAs.
• KPI should change to suit each stage (depending on your goals).
• Limit 3-7 KPIs per process/function.
If you need more information for KPI, please leave your comments at the end of this topic.