Discover the Best Expense Bill Format for Human Resources

Expense bill format for Human Resources

good evening ladies and gentlemen thank you for joining today's session on HR budgeting I decided to do this just to provide support and some sort of insights to HR practitioners so that we can have a broader perspective to HR budgeting most large organizations are already rounded up for rounding up right now some uh you know in I've done multiple iterations of their budget and it has gone through many phases back and forth but it's never too late to to learn about HR budgeting and how one can you know get the best out of it so go through it end to end face to face again as always I'm aware that there are also people on this call who have a very good knowledge of HR budgeting so um either on the chat box at some points at the later end of this when I'm through my slide please feel free to also share your thoughts your insights of course to be recorded so that people can get holistic a full understanding of budgeting you know we know embarks you know it's what your your experience that you're able to understand and you are able able to sit all right so we make it as um brief as possible one hour or less forget about we'll look at what budgeting is why do we need to budget types of budgets HR budget components methods of HR budgets also look at steps in preparing a budget and a few other things we also take questions and answer and the question and answer for today is specifically around HR budgets only wanted any question outside the domain of today's subject and area all right so there are many definitions and we look at a few of them okay so the HR budget refers to the funds for example HR allocates to all HR processes within the business environment or Enterprise so that's an example of the definition the funds allocated to all HR processes within the business Enterprise typically within a time frame maybe one year half a year a quarter okay all right furthermore a budget is a financial plan okay that our outlines the costs associated with running a human resource department okay let's see HR budgets provides an overview of what needs to be done and how much it will cost to accomplish the firm's objective okay if somebody also said the budget is telling your money where to go instead of wondering where it went I like that I found that very fascinating a budget is telling you your money to where to go instead of wondering where it went now I'd like to add one more definition all right and I think that a budget reflects both income and expenditure for me I see a budget as how we are going to spend money and also how you are going to make the money that you will spend I like to add that very very quickly now if you have other definitions you can drop it in the chat box it doesn't have to be a textbook definition it can be your own understanding in a sentence in the phrase in a short paragraph feel free to drop it I would also read them out as soon as I I see them are we together all right so why do we need to budget um best memory says that when the purpose of the team is not known abuse is inevitable even if you don't abuse it you are going to undervalue it you will not be able to place the appropriate premium on on the thing and that is why it's important we look at a few things there are many reasons just a few things for example if you don't have a budget how would you know when to stop hiring or when to stop making procurements or when to stop increasing salaries okay it helps to what prevent over hiring Sometimes some of our CEOs is only the budget that is their constraint because for them to paint above their budget they may need to go back to the board for extra ordinary approval and you know when you're going to the board for Extraordinary approval you must provide justification because you don't want to also show that we didn't plan ahead very well you don't want to show that I didn't have four sides okay so either that's a circumstance or peculiarity that is beyond anybody's control or an opportunity that is really compelling or a challenge that one could not have for sale and you know planned for again budgeting is important because it helps to understand starting it one of the things budget a budget by definition in my opinion is also a planning tool now for many organizations generally speaking the first thing they do is to like have a strategy session whether they call it strategic session or not doesn't matter but a brainstorming session where they come together as a team or it may be the the management it may be the board or the board and the management okay they say for the year 2023 or for this period this is what we need to achieve and then there will be other sessions that will now say how do we achieve what we need to achieve there is no need to come up with a budget to drive that agenda for example do you need more stuff what caliber of Staff do you need what kind of training would you need to provide for on continuous development and so you will see that budgeting comes in at a point in time to as a planning tool because as you are working on the budget you're also thinking all these items you are dropping in your budget with all of them materialize in January of February or March so in order to take into consideration cash flow you also need to take into consideration in my response of the events so it's not just that you say oh we'll do all these things in 2023 when in 2023 sometimes the time you want to do it you now also need to check what is our cash flow likely to be in this period should we do it earlier or later okay so it helps to understand staffing needs now you know I said it helps to prevent over hiring on the flip side a budget also helps to prevent understanding because really for those of us who did accounting you know you you watch out for variations of variance when you plan when you develop a budget native philosophy to the United States you want to adapt to it you don't want to overshoot the budget and you don't want to underutilize the budget you know why it may look like oh it's a good thing for example they gave us five hundred thousand dollars for training last year we just spent 350 000 we were very prudent it depends on who is looking at it some other persons may say no it means when you budgeted 500 000 you inflated your needs you are not meticulous also somebody can say oh no you have five hundred thousand dollars for trading and you utilize only 350 000 the remaining 150 000 technically you have cheated staff or employee you have denied them exposure to training what is the remaining 150 000. I hope you get that analogy of insights so it prevents understanding it also prevents under utilization of resources especially when you are trying to adhere to your budget when you have a competitive budget it can also help you it can help you in attracting top talent because it means that in the process of developing your budget you have taken into consideration a lot of parameters you know markets processes and you know current realities and threats okay it helps to create a plan for satisfying Talent don't forget that no matter what you do for example there is still the welfare aspect of HR at the minimum even if you are just maintaining people's salary we need a budget to be able to pay that salary now for small businesses for example sometimes if they don't plan well even if you are not increasing your employees salary you may struggle to pay the current rate so for you to be able to make provisions for example something as small as dispenser water possible water or such a water at the workplace it can be challenging if you don't project for it something as as simple as toiletries you need to budget for it so as you are budgeting for high-end things we are also budgeting for fundamental basic things in other words when you do your budgeting right you may be able to reduce employee turnover because you'll have put a lot of factors into consideration I decided just to bring out a few HR reasons why you need to budget I know we know the accounting reasons but God wanted us to be able to connect the budgeting with them with poor HR they are typically about two types of budgets or more but you take two in today's session the first one is Workforce budget now what's Workforce budget this is the budget that covers all employees in the organization it covers compensation benefits allowance and so on and so forth that's Workforce budget or employee budget the other one is what we call HR department budget so you don't enter on its own it's data by itself is like it's microcosm it's a small organization and he needs funds to run our activities so this is the budget that is what designed for HR department only okay for the operational aspect of HR sometimes it can be a subset of what to Workforce budget and I'm bringing this out because sometimes you know weight our people we plan for everybody but we don't plan for ourselves we will organize team bonding for the organization same bonding for the different departments in an organization but you will not allocate same bonding for your own units on your own team so you need to know that HR has a department due to need to have your budget of course it can be part of the whole body now I want us to look at budgets components now I will appreciate if you can also drop your thoughts in the chat box of course there's no way I will provide uh an exhaustive list but help us let us as a team populate the list okay so for example you can have recruitment selection and business and this is why sometimes I tell people that just getting other people's templates may not cut it because we may be constrained to the creativity or to the work process of the organization if your processes do not align with the process of the organization from which you are borrowing their template you may undermine your own now I know some organizations that maybe they have a generic they will say maybe for officers or entry level who will give you this hypothetical now they'll say we'll give you 5 000 error monthly call allowance now if you are a recruitment officer in a very busy organization you will not Advance 5000 will be grossly insufficient because you'll be making a lot of phone calls okay we'll be making what a lot of phone calls there are costs for for example adverts you may want to pay advertising newspapers or job platforms you may want to use LinkedIn you know that should be budget for this okay we may also need for example recruitment agencies I know that we HR we we do a lot of things for each other for free which is okay which is beautiful but sometimes when you are trying to hire especially senior roles you may need to get head hunters and these people these head hunters will be paid for their service the best they can do is maybe give you some some top some type of sort of discount okay now I remember back then way way back then I went for a particular organization's interview in Abuja and I came from from Lagos and at the end of the interview I was shocked they gave me an envelope and it was money so I was taking her back I'm sorry may I know the purpose of this they say oh no that is your transport flowers in other words they have like a mileage depending on where you are coming from they will give you transport money so at the minimum whether they take you for that job or not okay they offset your transportation today I know some some people on this one will say how many people will you give transport but there are still organizations like that and for example that's something you may want to propose or think about now whether you hire that employee or not for example I still remember this particular organization to today because they gave me transport money and I think I got some savings because you know when they give you executive transport and then I decided to economics and use slightly cheaper options okay so that's something that may be in your recruitment selection budget now if you don't do it in your organization you can't have this line item okay a cost of transportations for for candidates cost of refreshment during interviews they are from organizations I don't want to use the word many because it's relative but there are organizations that when you go and do assessments do we eat lunch or something you would drink if you do that you must budget for it there are also organizations that even at least the panel members because the family members they meet multiple candidates so anytime they interview and interview will spend more than two hours or longer they'll be refreshment you may also need to budget for it now there are associated costs of stationary for interview so imagine maybe you do assessment imagine there is a practical assessment you need to print paper people need to write your exam you need to score it and if you are automated people will go online they also Associated cost of you know either using a an assessment platform online or even if you're hosting it by yourself now there's cost of pre-employment Medical maybe you want to take a candidate you are sure they are convinced and depending on the role medical is required there's a US associated with this sometimes you may need to provide accommodation for some candidates okay um there are also organizations for example that may make provision for data for candidates for virtual interview from organizations to you they hire you and I'll be going to have the iiv you are resident in the states outside of where the organization is they may need to pay you some relocation allowance you may need to budget for that okay um it can be endless okay it can it can be endless so if you are an organization that maybe you hire foreigners as batteries you may need to make revision for for the Visa you may need to make progression for that for flights okay you may need to make Provisions for accommodation okay and so on and so forth so the dynamic table changes when you have international staff on your payroll okay so and by no means are this is this list exhausting now let's take a look at some components here in the compensation and benefit side of course no brainer you have to budget for employees Our Lives you need to budget for the employer's contribution okay the budget here not the employees pay their attacks but they are the one this HR or Finance depending on the organization that would be deducted underneath but you know if you don't conscious new budgets that you have a range of amount to pay us every month you will say the money aside so that's why I put it here okay um and other Associated course National Housing fund a nsitf for example was called Star Plus the school of the organization you need to make provision for it okay you still run gratitis schemes if you are doing leave allowance how and when do you do your live allowance some organizational pay leave allowance on the anniversary of each employee will make a provision for it something once in a year to all staff at the same time you need to make provision for it do you have over time in your organization you need to make a pocket so I remember I used to work in a particular organization and they realized that over time was getting out of hand they have to reveal to say look where I was shooting on our budget for over time and they had to review the criteria and the you know justification and you know criteria to be met for anybody to proceed to work extra hours you know it's because there was a budget for it yeah and the actors allowance you may need to budget for something if you answer some of your services you have to pay their suspect there is the actual features management fee group personal accident policy these are some examples is by no means again exhaustive you may also need to budget for for legal and control stuff you see nobody enters a new year for example and plans that um they will they they will reach any policy or they will commit an infraction but the reality is you never know when an employee or an ex-employee for example they may never take it to God what if they take you to God what is now work in an organization that will tell you that because there is no budget they won't approve discretionary funding so you may want to project an amount you may never use it but budgeting for that already does what shows through wherever you are working with that you are thinking broadly they are also thinking risk and risk management okay so you may have for example Legacy some organizations who have written I see what other legal liabilities do you think you can have on the job what Lego Claims can you have okay you may also budget for professional membership okay regulatory compensations expatriate insurance I remember I used to work somewhere Way Way Back in today and one of my expectations died can you imagine that we we have to fly the body the cops to UK but that was a huge amount of money it was a huge amount of money we have to also be responsible for the barrier cost I remember going to unfortunately enough that was my first time at the British Embassy they actually invited me over for a meeting to discuss the death of the British Citizen and one of the questions they asked me at the embassy that they was that oh do you guys have a bereavement insurance policy that was my first time back then this is a long time ago of clearing that they say oh it's rather policy they will have been responsible for the coffee the flies that I said really and I opened my eyes because the premium for the policy relative to the actual council is quite small but of course they will say why should we take a daily net policy once that it starts with that but that is crystallized an organization back then paid a lot for for that okay all right again we will look at all the type of companies but I don't wanted us to look at a few again if you feel free to also drop your thoughts maybe the kind of things you into your course on in HR the organization you can drop the entire box so that people who are following this conversation you can also learn one or two there's also Associated cost with health and safety the employee accident benefits you know sometimes you need to support the staff or the or the family of the staff you may need to have like uh how do I call this like a benevolent fund of some sort there are some situations or scenarios that we are call or apple that um that's um so group life insurance he covers some things that believe my policy covers but there are some things believe when policy covers that is unique from um group lives and insurance okay there are many types of insurance you know and it's depending on how you discuss with your Brokers okay but there are overlaps between the treatment insurance and group life insurance but there are areas that agreement Insurance specifically covers that group life insurance does not um does not problem for example like buying of Awesome he that won't be covered in the book about dreaming policy for example covers that delivery policy for example will cover four neural expenses that's the cost of the clergy or the Imam getting the various lots that those kind of things okay thank you for for asking that it's good sometimes we share some of this Insight so as I was saying that you may need to for example bother for benevolence so that you will say hypothetically now maybe two millionaire in a year or you say 500 000 reporter because when you are supporting staff or family of staff at management discussion that management discretion must be funded from somewhere it's not the path of the ending okay there must be an account to debit so you too as HR should be able to say look there will be some support we'll give some staff we may not be able to put our hands to it today but let's hear maximum amount for it okay there are some scenarios let me give you an example um they accepted for example many organizations today have HIV but we are all aware that HMO does not cover everything hmos have videos what if something happens to a staff maybe on the course of the job and then the HMO you eat the upper limit of the internet how is the company going to fund the excess or maybe it's not on the job and experience yes I know you can still go to any sit here and be like but don't forget that those money from those sources will not come instantaneously it will take time to process so you will Express new company money to first of all support the situation family intervention may be subsequently later you can tell me your reimbursement but you also need a project so for example I Works in a place where for example I have a 2 million error involving medical emergency budget and it was you know puts like in an escrow account somewhere that I will make that money the dispensation disbursement of that money to be readily available there was an ATM card with one or two people who had access to it of course anytime you use it to come and retire why when there is a medical emergency that may not be the best time to start sending an email to the MD waiting for the approval waiting for their empty approval to go to the CFO from the CFO to the internal accountant from you understand what I mean because time they say is what is money in in medical scenarios and your speed of intervention we matter okay so you may want to have a special uh fund for those those kind of things another game you know in HR you know data has if you follow the new Rich model your employee Champion Advocate change change agents HR business partner and we have administrative expert okay so to love things like stationary it's from organization HR and administer together or HR is doing the admin things so maybe rent and reads journals it tastes like background check that can easily fit also into recruitment or contract cost okay um Fleet Management those those kind of things you know then for example many of us they have one software onto other or multiple softwares some of you soft players have annual support fees some of these softwares have annual renewal fees you have to budget for it there are certain apps we use things as simple as for example maybe a Microsoft Office now in some organization you may have a dedicated I.T Department which may be managing that side of the budget in some other organization it will be an HR course because these are productivity things but just make sure whether it's 8 hours and in or not that those kind of proof that adequate provision is made don't forget to ask HR any any luck that we're afraid the productivity of the employees we come back to unto you will not be able to say oh no ice is in charge of Microsoft Office I don't know if anybody here to explain a situation maybe the license of your Microsoft Office in your organization expired and suddenly you could not use PowerPoint or what it could be very embarrassing okay and you could delay imagine maybe an Outlook or something is is locked out those those kind of things so you need to pay um attention to to some of these things so again just to recap three components of HR budget compliances technology Ben athletes welfare and wellness learning and and development okay Recruitment and on body you know even strategy planning about now many organizations are you know adding Retreats about now many organizations are also doing me planning the end of their party those kind of things in some organizations those party will be done beside with the corporate Affairs division in some organization it may be an HR events okay these things must must be planned all this thank God this TGIF stuff um employee recognition and rewards okay all this long service award um special events for example people do February 14 International Men's Day International women's day you know those kind of maybe cancer awareness day all those kind of events they may need to make a provision so let's make progress that we give out any requirements or questions and don't hesitate to to ask or drop it in the chat box I'll respond to it or some of our colleagues on this uh call also respond so they are basically two types of bodies is there more but the two most predominant one the first one is called incremental budgeting okay this is typically what many people or many organizations do if you want to do a budget for example for 2023 they will take the 2022 budget and revisit it and say oh how much did you budget for salary 2023 they will just carry it over to 2020 and I mean 2022 they will carry it over to 2023 and they will say something like are we planning to increase salary yes or no if yes by what percentage is it 30 is it 15 is it 50 you'll mark it up they will ask a question like like what percentage of the workforce is going to end a promotion is it 25 is it 30 okay but what's the percentage increase are we going to do color cost of living adjustment how much past how many what percentage are we looking at 10 5 50 and they will not put all these factors and incrementally what increase the provision for salary that's incremental budget okay so this is a method using the current budget a new budget is developed by making adjustment upwards or downwards to each item based on expectations okay all right so of course external training is part of Learning and Development okay and you need to you also need to to budget for for that okay now the other type of budgeting which many organizations are now also trying to adopt some have already even adopted it it's called zero based opportunity okay and in this method every item included in the budget must be justified before inclusion in other words just imagine that your organization just came into existence now it's like a startup or a brand new company and now need to come up with a budget so to speak there is no historical so if you are going to buy water you will justify while you are buying water because irrigation cannot be we've always been buying water someone can come with the argument that look our above all and our water treatment plant is perfect now that can satisfy the water so all you need to do is take a a glass take it to the top take your water and you are good so take out Cascade take out ever take out from the budget is that thorough look you can say oh we'll buy tissue for the convenience and someone to say no the kind of tabs we have in the convenience in the restaurant you can use it people can use water we don't need tissue I'm not saying you don't need I'm just using as an example that is how vigorously every line item you can say oh who um who buy 40 rings of paper somebody can say no in this new year they are not printing at all that all correspondence that let us go completely here Palace now as part of their control measure they need to track paper Usage Now and people above a certain threshold they will not send the email to them to say we have observed that you have used social quantity of paper now guess one of the persons that used to get such love message the lady that was always preparing for fathers and in that particular organization the employment contract used to be bought to like 10 pages and the lady said are you say I should do give offer letters again if I'll do that it's not something I can do unilaterally we need also Lego HR and we need to agree what information do we think we want to take out of your letter that would not compromise us several based budgeting you are starting on a clean slate every item will be laboriously critically reduced evaluated how important is it for the consolation of our business how necessary is it for the actualization of our goals so are we doing party if you are doing partying what type of party what magnitude and we do not feasts all staff come with your food by yourself and we share like Fellowship okay so that's what zero-based budgeting is again many organizations who it had to use to do incremental budgeting uh and raising zero-based marketing however if the organization is still using incremental projecting I encourage you as a professional you use therapist budgeting because what it will do for you is that you will already have a total justification for every line I take so if your organization is inside that they will call it as for example to a budget defense session when they invite you for the budget defense session they will be shots or maybe not shocked they will be amazed impressed at the level of thoroughness you have put through every line item in your organization it will be very difficult for the budget defense committee or budget Review Committee for example to slash your budget they did one of the ways to justify your budget one of the ways you you substantiate your budget is that you tie everything to this strategic business intentions you'll tie everything to profit you tie everything to cost reduction to tie everything so you're not doing anything as they fancy for example if you are putting Christmas decorations or projects like you have to defend it creating the office for Christmas how does that affect the bottom line you must be able to show us a line of sight either you will convince us how it will motivate make the office address more lively and then you will connect you to increase productivity and maybe you can tell us that last year we made more money during Christmas and the year before than the other period otherwise I can tell you that Santa Claus is not a shareholder in this company can you please cut off all these red lights I hope you understand what I mean so anything you agree you are not doing anything out of tradition you are doing it out of a business need a business requirements okay so there are some softwares that can help with your budgeting there are many just mentioning a few I'm not advertising for any good books like zero fresh books web accounting say 550 clouds and maybe whatever software you are using today we also help you now let me quickly mention here at this point and I think this is a key part of this um session of this particular webinar we're having to do again let me add if you have any thoughts or comments feel free to drop it in the chat box or when I'm through with this slide please wait wait wait and share your thoughts I also be glad to learn it will be helpful for everybody on this call and everyone who would watch the recording of this session this year or any other time in future now I put this together and I thought about it of course again it's not exhausting but there are drivers of budget what do I mean by drivers so let's take light for example decide that you are using thcn or you are using generator or we are using maybe solar batteries inverter those kind of things now many organizations will probably be using a combination of all these things depending on how big the organization is now if they are on generator you are going to be using most likely this way if you are using big industrial generator let's assume you're a manufacturing organization now that I think called diesel how much is it now we all know that diesel is what is a very volatile product and the price is typically what from trades let me make you laugh I know one or two people you know last year when they were budgeting for 2022 maybe they used like 600 naira the friend was telling me maybe 600 or 700 was what they populated and in their budget different session people said no 600 is outrageous that kind of a thing I can't remember the exact amount because maybe it was like they added like 200 naira or 250 naira per liter as Marco they felt oh no this is lazy thinking guess what before the middle of this year their markup of like 200 or 250 naira per liter was across three sufficients the price has gone up to like 500 or 600. so that tells you that for example inflation so if your budget in 2023 the line items are exactly the same as the line item in 2022 I can put it to you that the cost of that budget will go courtesy of what inflation so you want to be sure other Associated things they are this I can say these are economic variables or components of factors so like for the next thing so if we do a lot of importation maybe you do foreign trainings for example people will be the price of cost of three of those foreign trainings don't change Boys in dollar the amounts we spent next year will be more so let me use an example maybe you are doing you pay for professional exams for HR people in your organization maybe sphri or SHRM SCP those kind of thing let's assume is 450 and the price has been stable for a while the amounts you will convert to the dollar in 2021 is different from what you converted in 2013 it will be way different from much converted in what 2023 you have to apply for that so foreign exchange will be a key driver of your budget now the first and primary driver okay is your what your business strategy you don't just block your budget from the year and that's why you don't just collect uh only any other options budget and say hey let me just use it for my own except again if your business strategy and only any adoptions organizations business strategy I will arrived otherwise my budget can be be completely misaligned he cannot put you in trouble because you'll be focusing on parameters that has no bearing with what you do the business strategy which is you know there are multiple goals in business strategy what kind of what market share are we aiming for okay what what turnover are we aiming for what expansion Market expansion are we aiming for how many new products or Services I would bring you to the table all these things will determine for example the Manpower we have today we need the adequate how many more people would we meet what skill sets so for example maybe you are expanding it to check then you need software developers I hope you know that software developers don't come cheap so your business strategy will work is a key driver of your budget then your projected growth what are you thinking about what are you looking at if for example you are only Lagos as an organization but you know how to cover entire Southwest you want to have presence in each state capital or you want to be in the sixth year political Zone in Nigeria for example it rains alone will be significant on your on your budget then last but not the least and I need to mention this at this level is the national budget when I say National budget for example we that we are in Nigeria you must look at the project of the federal government of Nigeria either the current one or the next one if it is available okay it may be available it may not be the final version but some versions of it will definitely why would you need it when you look at the budget of the federal government it will give you certain insights started inclination as to what product for example will be banned imagine you are into furniture for example and they say oh deportation of certain items should be banned what will happen to local products or local substitute their prices will go up so please at this level for every of us who has graciously decided to attend today's webinar when we should be wrestling any of us that will watch it later when they said buhari wants to read the budget don't think about buhari as a person you need the information he wants to be just listen because it will provide you certain context it will provide you certain insights okay start using certain elements that you may say oh boy we need to go and revise our budget based on these these these these for example okay if they announce January 1 removal of first subsidy what happens to that component of your budget you will know that it's going to Skyrocket so I just thought I should include this particular slide and spend a few minutes around here so that we are also very conscious of it and we don't just do our budget um in isolation Okay um let me take one or two things and I will look at our baptism again I need to say here even though you know typically I tell people that there's no way you will teach a part of HR that you won't touch base with other parts of HR so you know there's data analytics in everything we do in HR including in budgeting now generally what percentage of your total organizational budget should HR budgets be what percentage of the total organizational budget should your Workforce budget be so I may not be able to give you [Music] the universally accepted figure but some people will say if your employee costs can be within the range of this unestimated this now or maybe 15 to 30 percent the lower the percentage of your employee costs to the total overhead total budget the better so the organizations for example if in 2020 their employee cost was 25 by 2023 they will be aiming to drop it through 20 or 18 or 22 so you need to be careful so if you're in an organization that has been in existence for a period of time part of the trend analysis you want to do is to compare ratio of HR or employee budget for this year versus the last year and then for the proposed year so if it is 25 is it increasing or reducible in some of these simple ratios accountants or board members used to say oh go and reduce your budget by social amounts they were looking at the ratio and they will pick a figure that will take you back to the same Ratio or will drop drop the duration if we are also making the defense sign they are trying to say oh last year our people budget was 23 of total we have dropped it to 19 we are already saying don't touch my apologies except of course we don't have any um say any thoughts beyond our control we also want to you can see this picture this um pie chart you know it's this also hypothetical so when you do your budget especially the key areas you want to see What proportion lower percentage is your staff salary what percentage for example is your training some people will say Oh They'll be training course should be like 10 of employee costs some will say no five percent someone will say 20 depending on the face of the organizational lifestyle when you say start up are you in growth um are you immaturity are you approaching the crime or are you approaching Revival so that you can scale up and scale out of a moving decline those kind of data so which means just like they are looking at the what do you call it now the percentage of your employee budget to Total organizational budget only yeah you will now also look at each cluster each sector of your budget to say what was the percentage of training last year of the HR budget and the percentage of training this year and there was a proposed percentage of training so if you are telling employees that oh come on guys replace the opinion on development of our employee but your training budget is reducing you see you see that that data does not affirm what you are saying okay you may say oh not everybody will have disability to some of these details but come on somehow people will get to people who get to know so this is just a random example you can create anything depending on what works for you okay so you can have different items here you have account name you see regular salary patent P you can just list all the items in HR then FY is financial year typically when you're doing budget is good to show like two or three years so that we can see a train what was the salary for example in 2021 what is it in 2020 I mean 2022 then what are you proposing in 2023 when you put the pictures like this we can readily see whether it is increasing it is stable or it's declining and then you list all your your items um like this okay so you may also want to do for example the this is year 2022 you may also want to show what was the budget for the year 2020 to okay what was the actual now what's the difference between actual and budget budget a budget is a proposal who post intent of what expectation but the actual is what we actually utilize so we bothered that I will spend 30 Millionaire on salary but we spent 33 000 that would be a negative variance are we together so you may also want to show Maybe This Year actual and variance last year actual and then sorry budgeted and actual and then what was the various you want to you may want to look at your budget efficiency and budget utilization okay because there are organizations for example if your budget will last year if there are certain budget parameters that you under utilize the budget as a default in the next Model cycle they will cut it that's why um don't let me mention starting agency but we have an idea of what I'm saying you know towards the end of the year they will start doing plenty plenty plenty trainings why they want to utilize the budget because they will say if you don't do these trainings next year the house will cut our money or the board we cut our money don't be like that when you budget for example trading your training calendar should have the spirit there are certain trainings that should come even if you are thinking upfront that we should train people this December so that they can start January on the high not that a training that will impact the 2023 um strategic intent I'll get it you will now deploy it in August when more than half of the year has gone maybe early January so that they can begin to get Returns on on those uh trading okay so I've already are you there to this while discussing the last slide you can see different components of trainings and you can see if is it going to decrease is on an increase are we maintaining this you can see how recruitment Learning and Development payroll share Services employee relations Total Rewards HR technology data analytics diversity and inclusion of course this is not by any means um it's exhaustive just also showing you budgets Hospital budgets are expressed it is spreadsheets you can see here cafeteria plan Administration okay you can see live Insurance you can see here profit sharing and so on and so forth so you can see what was the initial budget what was the allocated budget okay what are the the incentives so let's quickly then who's the steps in preparing the projects I know many of us all of us are familiar but let's just run through it the first step is to establish what a baseline budget this will give you a starting point to work from as you make your budget for the upcoming and yeah next you want to look at your revenue and expenses from the previous year this will help you to identify new trends that you can use to predict your cost for the upcoming year for example if you notice that your training cost has been increasing each year you can also budget ingly okay or once you look at the past it is time to start planning for what the future Begin by setting some goals related Department what do you want to achieve in the next year once you've got some goals you can start to allocate funds to this specific react okay there's also what we call budget process it's budget formulation when you're continue together where there's the approval process maybe the management the broad at the unit level then there is the budget execution which is very key so my people like you know when they uh you know ask chicks you know how they sit on them you need to sit on your Budget Finance has a funny thing if something is not budget pay for they easily tell you HR there's no budget for that but let me talk to even the one that there is budget they will not be telling you that there is no money you need to be aggressive and engage in quotes fight for your allocation because don't forget that you are budgeted for in engagement programs initiatives to drive productivity once somebody denies you funding what are they denying you the consequential outcomes and if you don't achieve your results you cannot come and say it is finance that you can release the money so you must know how to hold them like the jugular and fight for instance so execution is very true and there is also budget um over October so [Music] um intentionally also put this here you know how do you fund your HR projects you know they I wanted to say they don't let me use our one thing so it is often said that HR is a cost center they say HR is a poor Center that we are always spend the money okay that's a story for another day okay but how do you spend your budget how do you fund your budget first and foremost there should be expected Revenue into the organization from either your sales your your production your your services now you need to have a good idea of this expected Revenue now I hope you also know that it's not all the revenue that so to speak belong to the organization so you can hang 100 million don't be carried away of the other million for example what will be your profits so if you have 800 million but maybe 5 million is the profit then you can only plan on that five million and HIV loan cannot take out the 5 million don't forget that 5 million that should be for example the earnings for the shareholders you must be able to meet all the obligations of the organization and all the other departments why am I so interesting so that you are modest in your thinking eight times should not take they request to the management that they will ask based on funding why we as HR we are financially appreciated enough to take the certain baselines into consideration and we've been able to see that genuinely we can accommodate that budget and we can anticipate the returns of on investment on our initiatives so that nobody will watch cut it down or turn it down and as exponentially okay so profit now I put the word goodwillian and for those of us who did Accounts at whatever level and Goodwill is is is good will let me put it that way I know that sounds like tautology so let me give you an example so I'm not too long ago some of my colleagues on HRV procedure based on relationship reached out with there are only any peace we are doing our end of their strategy we don't have money they were very upfront say please can you go and help us and do one or two sessions we also want to show a child is contributing to the business and I checked my schedule I was able to cover some time and I went there did like two hours today and it was very important impactful although I think the empty now said ah that guy don't let him go empty-handed you know they're not package on Sylvania and under the YouTube something that's it but of course that was just to like a talking like an appreciation now why am I bringing this up never always think about resources only from money for example there are many people on this call right now right now that I can get you to do one or two things for me free of charge or at a very reduced rate similarly many people on this court because I'm just checking to the names I know many people here personally and directly people can get me and by extension other things like that so when it's not everything that your budget must require money okay Innovation creativity would we I say it you can do a team bonding session that you won't spend money let me give you one tiny example just imagine all of you gather at the office after work one day and you pick a good film from Netflix use your projector and project it you may not necessarily explain you didn't go to the cinema the Netflix to use one of your team members already subscribed in any way you know if you now want to spend a little money you just buy popcorn do you understand what I mean and that's what I mean by what good will share other sports of course the investors people who own the business as part of the money they put down you may allocate part of it for example if when you start up your company you will pay salary whether you have any income or not that typically will come from what see how that spot then another point I put here is what cost savings and let me borrow a few from what my friend Victor um yesterday you will remember no not yesterday on Monday it mentioned that he saved money from HMO and channel leads to trading and development that's customers in other words if you can be Innovative you can be ingenious and you are able to people are supposed to spend ten thousand errors somewhere you were able to achieve that same effect with 5000 then you are not able to mobilize that 5000 error to something else that is highly productive that is possible do you understand again you can do things on credit so I know people who they are established relationship with vendors let me give you an example maybe it's a training effect early here you really don't have money but you know that those trainings if they are done anywhere they will impact positively on productivity you get those training friends for example to do it for you on credit and maybe by second quarter you pay them off when your your liquidity is is is more um it's more abundant you understand what I mean that's on credit so why am I saying this these things this conversation we are having this page and one of the other app is nobody is anywhere I had to come up with it HR people you they may not put this in our job description but let me tell you the first line on your job description is capacity to think write it down the first line on your job so if anybody asks you that HR what do you do among God the Plenty things you will tell them the first thing you should say or don't end your list of um job without telling them I think we actually think for a living you must think around how you will need to do it whether it's going to be ready for profit from Google from Childers one from person there's something I wanted to put before but I remove it but let me mention it that you can even use they are so engaged they are so invested that they don't mind using their resource they will tell you that oh my mother owns a lounge let's do the same building there you will use the launch for free but you will buy food you just got a discount let's make it on a staff whose mom has a lounge be motivated okay ask for help you can also get an organizational loan for for for some of this other other things okay so it's important that it's not the human resource budget the organization must determined the sources of revenue this is very fundamental okay you need to identify the sources of the revenue so don't just populate your budget title I challenge you I encourage you also have um like what do you call it now like a column a column a column that would say Source or front are you put for everything this will be from where they knew our profit this will be from this will be how they saw if you can't tie a source of fun to it you may want to take out that particular language okay you know so as much as possible I alluded to this earlier certain funding early in the year don't be like the people that in the last quarter of the year do not be trying to say let's quickly utilize our phones quickly utilize your phone from January of course utilize those ones on high impact programs high impact HR initiatives on Learning and Development things that we have instant or near instant consequential impacts on the productivity of your employees of your team all of your organizations you want to introduce the software that will streamline work do it very early in the year begin conversation now don't do the software in August because people will say but to introduce the software last year what result did we see okay we don't remember that it was introduced towards the final quarter of the Year okay so as I wrap up my slides primary goal of HR budgeting is to allocate resources within an organization it ensures that organizational meets his mission and goes while minimizing in effective or wasteful activities without proper budgeting procedures employees can lose productivity and moral ultimately if you need to decrease in productivity and in every ability of the organization or the team members to produce at its best okay so I hope you've been able to learn one or two things please don't identify you do this just type one or two things that will link specifically today so I want to really judge because I I was thinking about it that everybody knows about budgeting that's why I wasn't expecting like 40 50 people will join this honest control I'm impressed and I thank you but again let me just see and if you didn't get anything it's also okay and I like I'm inspired I like that well tell me specifically don't I don't want motivation okay tell me exactly maybe something a technique can approach an inside or something you can drop it in the chat room meanwhile the session is not over even though we've done one hour and I was thinking this will be one hour so I would like to throw this there are three things we are going to do now one if you have comment and contribution please feel free we're all Learners something you feel you can add to the little upset that will help people on this form please raise your hand and I will quickly enable you to talk so I first of all want to take comments and contributions then move to questions again when we get to the questions which will be anytime from now when somebody asks the question anybody on this phone can answer it doesn't have to be me I may say one or two okay you can also type your your questions okay thank you everyone for for coming out tonight so you can raise up your aunt and maybe for your contributions or your comments or maybe want to share an idea of how you are able to to get your budget approved for something and expressed around budgeting that's that's also very okay all right so nobody so to speak is willing to contribute yet um we're also upon do you want to take a question if you want to raise why I'll prefer you raise your hand and speak is that it's easier for people who come and listen to the question online but I'm currently going through the chat box um my friends um people like I'm getting Daily Bread on this car help me go through is there any question already maybe while I was speaking earlier okay any question all right so I'll just be reading some random thoughts um said I got value types of budget and source of Revenue again okay um directs where your money should go very exciting thank you so much uh philosophy I didn't say take our budgeting seems like it will work best if the organization has a budgeting habit and an effective accounting or finance department exactly if you have an effective finance and Department finance department to help you greatly also you have a budgeting ability to help greatly but don't forget that we all start a habit someday somehow this year is the year to start that habit if it doesn't exist already in your organization for last time I said the first HR rule is critical thinking thank you teacher said I learned everything about how to do data budget okay even when Mr emissions I go to it but honestly I didn't understand it until now the internet says I learned to always have a source of funding for each budget okay that's uh insightful thank you so much here today talking to you let me see here um my sister says thank you sir yeah indicated some other critical components that we have never captured before budgeting around believe me we used to assume good life Assurance was in North Korea okay blessed I never heard about Deliverance policy before me too I didn't plan to hear about it until evil man died for my from an organization to again I tell people can you imagine Beauty members invited me no you know people they say they won't book appointment and then called me it is funny but it wasn't funny I mean my friend said so let's rest in peace we're actually sharing office space so it was also a personal loss for me now Doris because what happens in the case of budget party I suspected that somebody will pick it up you know I thought about this question I was saying this is not National accept me now and most people yeah are in the private sector and the people of course have quite a number of friends in the government sector you know I I get this and it actually happens you know and what is budget party budget party May mean intentionally over inflating or increasing the cost of items so you know that a viral is 15 error but we intentionally call it 25 naira that's one type of party let me give another type of budget party you actually need 200 virus but you will say you need 400 so you can have price padding you can also have quantity padding then you can have party that you will put something that you don't need at all [Music] you inflated the price this one maybe something you don't need at all like a fictitious item or an irrelevant item maybe like a training you don't need you just increase it okay so it says what happened in cases of budget padding in some Department especially the obvious one what should HR do this together so generally speaking depending on the organization a child will also be a member or we represented in the HR committee or HR body defense and what the important defense does is all members of the defense will evaluate critically now they are not fighting we are not trying to be malicious we are not trying to be nice too okay we're not looking for enemies the Hallmark of a budget committee is on objectivity it's an objective driven process and what guides this objectivity what our organizational coverings what are the Strategic imperatives strategic objectives for the budget here under review okay so if for example we say we are currently in Lagos and we want to expand to Southwest Nigeria we will need more staff that is a no-brainer but let's say we are currently in all of Nigeria and also working reduced to only Lagos that has also told us that we have to leave our staff at some point so it's objectivity so if HR when HR should ask critical questions don't make it look like only any creative no just say oh we observe social item is on the budget can you tell us the purpose or we observe social quantity what was the quantity that was used last year or two years ago okay what are the parameters and that's why I told you drivers of budget so if you say what are the parameters that you know drove this item or drop this pricing by the time they shared it if for example they are trying to be funny or dubious they will be the one to indirectly report themselves between the apparent that you you caught it if you understand what I mean there are ways to just ask those questions unintentional even though it's intentional and they will they will get to it so I'm happy that you're getting that employee has decided to speak so yesterday please um news and it will be a contribution thank you so much for this session the life-saving session thank you so um the issue I have is um I have to to um contribution to the no contribution but I just want to you know express myself when we do that about uh two weeks back or a week ago I had um a brainstorming session with the employees in the office so that at least you know I can get to know where everyone needs help or maybe where they are lacking one thing or the other and during that session I had a discussion with the finance person you know just to ask that are we really making money this time around because um my my industry went to Stock Exchange I know this time around when it's even coming when it's coming towards the end of the year it's summer the the income is always you know very low and because of the current economy status so it's not really allowing us in that industry generally not even my firm only to make enough income and also you know election is approaching so people have been very careful in the kind of so I was not asking now okay are we making profits and all that so at least before I even throughout because whenever I come like my boss will be like today obviously baby party you know like I'm here to make cup ask for money or something you know and after this uh discussion I I went back to the end it's just to give him at least a report and a brief of what the meeting entails and when I about to make mention of oh I had a discussion with the finance and all that it was like I should not bother myself about finance and at that moment I got felt okay what we might because I I didn't go further because one thing about him is mood matters if you because so I just feel like okay I think that mode at that moment don't let me you know put further because in my moment I was like why shouldn't I ask about the funeral because now now I like I bring any you'll be like you are you I don't see but you're just spending you're not bothered about you how we make money no I'm bothered about how we make money you're still telling me I should not bother about the finance you know at times it's because he said this is a child it's not for defense attached it sounds so easy in the hair but the kitchen is work another thing is when you talk about partying and party now okay now makes me have a flashback of about um last week when I was making a hand of the year um budgets and doing all that preparing for the gift for clients and the one for staff and I remember that when it comes to the oil parts for the hall for the staff because I know that the price is not you know it changes so I don't want to put a particular price because I know the next event so I I had a a extra over like one thousand five or one thousand on each so that at least and I wrote at the beneath that the um the price you know can actually change uh due to Market um current market and price so it's it's also you know it's open to change either to reduction or or appreciation and all that so when you're not talking about I was like like you know you know so everybody else was like I have a lot of budget though because I know what I when I go from my supplier I was around but let me just say 8K and I made the 9k the reason because she said if you don't if you can't get it at that moment she cannot say she cannot even you know give us the Assurance of what will happen tomorrow so I made it to Nike okay okay no matter how you want to play play at least and all that you know and we can I know I save money aside or rather pay that exact money so that for the budget party corn would even be like the budgets you know so um thank you once again for this um session all right thank you so much I'll read a few more comments and then maybe take one or two questions and then we will wrap for okay and foreign Goodwill for high impact events is a good one all staff can have something to contribute exactly I may say it's great session I learned a lot about key drivers of budget especially respect of inflation and exchange rate Transportation Funke blessings also picked cost of living adjustment olata says thank you your explanation on zero-based projecting was explicit for startup companies okay um iodide the resources amazing session learned a lot and effectiveness of the little things like budgeting for the office suit Microsoft Office and medical magnificent projects Loretta oduro says this came and be working on my projects currently this training gave me more disappointing so much now one thing I'll say then I'll take two questions that are already on the group and we'll wrap up so there's something and this may address a little This concerns so that we don't necessarily need to you know legally part so from organizations allow that ma