What’s your budget?

Happy new year!

We wish you all have a great 2022.

After being disrupted by the COVID pandemic for two years, it’s time to regroup and plan for your next move.

The world ahead of 2022 could be bright and sunny.
It is a recovery phase for many businesses.
But, are you ready?

Will your customer come back after this pandemic?
Will the operational costs increase?
Do you need to cut back on expenses?
Or increase the marketing spending?
Any change in the product line?
Do your customer still need your product?
Or is it better to switch business models?

The pandemic has changed how a business operates.
Consumer buying behaviour has changed.
Goods may no longer supply the way they used to be.

Being a small business, you may have to change to meet the changes.
Do you have sufficient financial muscle to change?
What should be a realistic projected sales revenue?
What is the new operational cost?
You need a budget.

The business costs changed when the business environment changed. The cost changes can be range from distribution, marketing, direct cost, finance cost, etc. With an appropriate cost allocation (fixed and variable) and desired margin to achieve, you derive a realistic sales revenue and input the budget into the accounting system.

Create a budget in the accounting system

Most of the budgeting feature in a small business accounting system is simple to operate. Budgeting is usually a wizard or form-based, easy for an accountant to follow and create.

QuickBooks Online (QBO)

Click on the Gear icon and select Budgeting from the list. Then, click on the Add Budget button from the budget list to start a budget.

QuickBooks Online (QBO) budgeting

Follow the budgeting wizard, enter the name (e.g. Budget 2022) and select the date range, budget interval (monthly, quarterly or yearly), building the budget from scratch or based on last year’s actual data, etc. Finally, enter the budget figure into the appropriate budget cell.

You may “alter” the budget from time to time to reflect a more realistic goal or create a new budget if the actual has deviated too much from the ideal, and print a Budget vs Actual report to compare your budget against the actual performance.

QuickBooks Online Budget vs Actual report

QuickBooks Desktop and Reckon Accounts Desktop

Reckon Accounts (formerly known as Reckon QuickBooks) has a similar feature and program layout as Intuit QuickBooks.

If using Intuit QuickBooks Desktop or Reckon Accounts, go to the Company menu, Planning and Budgeting sub-menu, and select Setup Budget.

QuickBooks Budget

Click on the New Budget button from the budget list page to create a new budget. Then, follow the wizard to set up the budget year, budget for Profit & Loss, or Balance Sheet, any additional criteria for the budget, etc.

Besides copying the budget figure across the months, you can adjust the row amount based on a percentage increase or decrease in QuickBooks Desktop (or Reckon Accounts).

QuickBooks and Reckon Account budget

Then, measure the performance with the Budget vs Actual report.


MoneyWorks’ budget feature is under the Show menu. It provides a list of accounts (both Balance Sheet and Profit & Loss account) and the sub-ledger if you have switched on the departmental accounting.

MoneyWorks budget

Enter the budget figure into the cell and filling down, duplicate the data or distribute the value across the months.

MoneyWorks Profit Budget Report

Then, monitor your progress with the Budget Profit report, comparing the budget against the actual.

We don’t plan to fail but often fail to plan

Small businesses are usually more concerned about cash flow and day-to-day operation, but having a budget is extremely important when moving towards a new normal. With limited resources, it is more crucial to monitor the performance in an uncertain market.

Budgeting is like a compass, helping the business navigate, achieve the revenue and costs as planned.

Good luck!
Stay safe and healthy.


December is the last month of the year.
It’s a time to celebrate with your loved one.
It’s a time to regroup after being disrupted by the COVID pandemic for two years.
It’s time to have a resolution for the new year.
It’s time to close your book if your company’s fiscal year-end is in sync with the calendar year-end.
It’s time for a stocktake if you are closing the book.

What is a stocktake?

To compare the physical stock count against the stock on hand shown in the book. Adjust the book if there are differences due to missing or damages.

What and how to prepare a stocktake?


First, determine a cut off date. Assuming you have decided to do a stocktake on 28 December, you should enter and post all inventory related transactions before your stocktake. Then, do a backup before you proceed with stocktaking.

From the MoneyWorks accounting system item list, click on the start stocktake button to proceed with the stocktaking process. MoneyWorks will then create a snapshot based on the current stock on hand. Any transactions entered after the stocktake started will not account for the stock discrepancy.

Assuming your current stock on hand is 100 units. MoneyWorks copy the current quantity (100 units) into the snapshot quantity when starting the stocktake. MoneyWorks will use the snapshot quantity to compare against the actual count entered to derive the differences (you should not enter any inventory related transaction dated before the stocktake).

Print a stocktake worksheet report for your store person to do the physical count. Enter the actual quantity counted into the stocktake list once the stocktake worksheet has returned. Select all the items and click on the finish stocktake button, then enter the stocktake adjustment journal date and account to complete the stocktake.

You may then proceed with stock revaluation or written off for obsolete products after your stocktake.

Stock valuation report.

Print a stock valuation report once you have completed the stocktake. The valuation report will base on the current stock on hand quantity and value. Ensure the asset value in the valuation report is the same as the ledger, and proceed with other closing tasks once verified.

Stocktake is part of the financial year-end closing. Start the stocktake process before your long holiday break.

Stay safe and healthy.
Happy new year!

Merry Christmas!

Merry Christmas!