Budgets: The two most important ones for a small company

Kurve med pil oppover, som illustrasjon til bloggpost om budsjett.

Drawing up a budget gives you better control over costs and earnings. If you haven’t yet set up a budget for next year, it might be a good idea to start now.

It is not necessary for sole proprietorships with no employees to work out advanced and comprehensive budgets, whereas a private limited liability company has different needs.

Unfortunately, there are few good examples of budget templates for the smallest businesses. However, mastering a spreadsheet, like Excel, will get you a long way.

Budget: Expected earnings and costs

When creating a budget, you submit the earnings and cists you expect in the upcoming period (usually the next year, or the next three years).

Doing this will give you a pointer on whether or not you will earn money.

The results budget

This is to set up expected earnings and costs. Will you be in a surplus or a deficit?

It is important to get as precise a picture of the period as possible. Use your income statement or previous accounting numbers as a base while working with the results budget.

NB! Do not fall in the typical trap of underestimating the costs and overestimating the earnings. Doing this may sometimes feel like a natural law.

The liquidity budget

Liquidity means payment ability, and the liquidity budget tells you whether or not you, at any time, have enough money in the bank to pay the bills.

Example: If you, as self-employed, have large earnings one month, the liquiduty budget will help you put this in context with the expected income and costs going forward.

With high amounts in the bank for certain periods, it is easy to spend more than your economy can handle. The liquidity budget helps you be hard-headed when it comes to how you spend your money. In the liquidity budget, you use numbers that include VAT!

Templates for budgets in Miniforetak pluss

Are you a pluss-member with a sole proprietorship? If so, you can download a simple budget template for running budget and liquidity budget adapted specifically for this type of business (English article coming soon).

And if you are running a limited company: We also have a bigger budget model which is created for limited companies (but can also be used by sole proprietorships and other types of companies (English article coming soon)).

You can also see what Altinn has written about budgets during the operational phase (available in English).

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