Despite dominating the financial headlines for several years now, many companies are still not prepared for the changes to the businesses that will result from the Patient Protection and Affordable Care Act (aka ObamaCare). Small companies in particular are struggling to figure out what exactly they're supposed to do. For instance, almost half (46%) of the companies surveyed by Paychex say they don't know what the government expects of them in the way of complying with the new regulations. And it's pretty likely that large companies are having similar problems with compliance, since there's not exactly an ObamaCare for Dummies-style cheatsheet available (at least, not yet).
The complexity of the Affordable Care Act points to the necessity for a budget process that can accommodate and incorporate the myriad changes that can occur when managing a company. As Alan Hart, a former CFO and now a consultant working with solutions provider Centage Corp., explains, "Unless [your] budgeting system is open to modifications without having to perform programming or enter an array of new formulas and links to other worksheets or system modules, these modifications... are unlikely to be made."
According to Hart, one of the biggest areas of concern is payroll-related expenses, especially since companies are going to have to change the way they forecast and incur these expenses. That's going to make it more important than ever that financial executives are able to trust and rely on their software systems to account for all manuyfacturing activities, all internal and external financial reporting, and planning and forecasting. A tall order, indeed.
Hart describes what such a solution might look like:
A capable solution will have dedicated business modules, which are pre-programed sections of the main application and will be equipped with business rules and menu selections and will be ready to quickly implement and put to use. Typical planning/forecasting modules are revenue with cost, operating expenses, capital budgeting, loans and liabilities and of course, a dedicated personnel module.
Learn more about changes to the budgeting process at Business Finance, a companion site of IndustryWeek and part of Penton’s Manufacturing & Supply Chain Group.