Traditional budgeting during financial crisis

[EN] This study examines the evolution of budgeting practices in the extremely difficult Spanish economic environment. In order to analyse if companies are still maintaining their budgeting process and if, right now, they are facing more difficulties in forecasting accurate indicators, two similar web surveys were addressed over two periods of time, firstly in 2008 at the beginning of the financial crisis, and secondly in 2013 after five years of a downward trend. In addition, in-depth interviews were conducted to investigate how companies brought more flexibility to their budgeting process in order to cope with environmental uncertainty. The survey indicates that 97% of respondents are still using a traditional budgeting process being this result similar to the one found in 2008. However, 2013 showed that the reliance on forecasted information is being increasingly questioned. Furthermore the study revealed that the respondents are bringing more flexibility to their processes, being able to modify the objectives once the budget is approved and to obtain new resources outside the budgeting process. This paper contributes to revealing information about difficulties in setting reliable objectives in a turbulent environment and provides data about the evolution of budgeting practices over five years during an austere economic crisis.

Financial and Economic Report of a Specific Business Group

As a result of the natural evolution of the economy, ever-changing, unpredictable and cyclical, companies must adapt as far as possible to the changes that have taken place in order to continue with their normal operating activities. Likewise, they should also try to maintain a structure for long-term growth, trying at all times to generate the maximum value. The main objective of this project is to provide financial advisory services to a business group, trying to forward solutions and measures that according to the author can be effective. For this end, the situation of the group in question is analysed from early 2008 to the present day, examining its evolution, what steps have been taken together with their corresponding results and the economic-financial situation of the company at the end of last year. Contact with the company was kept throughout the process of analysis and assessment trying to take advantage of the feedback generated so that the appropriate measures can be adopted if the management considers it to be adequate.