It is nice to talk to finance people for a change. Most of my working life is dealing with the Higher Beings in C-suite who have only two concerns: firstly, to maximise their own package, secondly to maximise their own career in order to improve their own package. I also spend a lot of time with human resources.
Pay budgets
Every year, I get to chat to someone in the planning team about the annual budgets. This year it is William; he with the rather distracting blue eyes. I try to keep my mind on the job in hand. There are two parts to the budgeting activity: one is our own departmental budget; people costs, expenses, and any consulting costs we take centrally.
This should be Big Bad Boss’s watch, but for a numbers guy he does not actually like doing any, so it falls to me. And to be honest, I quite like having a reason to snoop on everyone’s latest pay. I see that he was moved up a grade last year and had a fat pay increase to boot. I am not jealous; my perspective is this only goes to demonstrate the art of the possible. It also gives me confidence when it comes to asking for a bigger increase myself next time. To make sure he will be able to afford it, I add a little buffer to our budget under ‘other costs’ and hope no one asks for a description.
Working out what we are going to spend on advisors is more difficult, but these days, we fob off as much as we can onto the local business units. Big Bad Boss also spends quite a lot on entertaining, but I am fine with that; it keeps him happy and out of my way for the most part.
Fringe costs
The other part of my budget input is working with the finance team to confirm the percentage to use for fringe costs for all European countries. They add a rough percentage to the salary estimate to cover all the other elements of reward. This is where it gets messy and, this always surprises me, nothing ever adds up.
Finance does provide a breakdown of fringe costs year to date and all I need to do is confirm their assumptions on what that will look like for the next three years. It should be easy; we now have a fancy benefits database, provided at great expense by Mercenary Benefits (don’t get me started on that particular request for proposal), yet we still do not really have a good handle on benefits in all the countries.
That is because any database is only as good as the data that gets put in it. At a local country level, some of this data may be input by very stretched HR business partners, and although they are great at the wiffle-waffle, I find they are particularly challenged when it comes to anything to do with numbers. Even my source of truth has to be used with a degree of caution.
Benefits budget
On the accounting side, the finance team has done a great job of breaking out the chart of accounts into relevant cost codes for all the variations on social taxes, and major headings of company benefits we provide on top. I am really happy with how benefits costs should be broken out, because we agreed the headings together in a previous year. That would make it really easy to see what we are spending against what is expected.
I should say in theory because the account codes are not being used properly. When I dig into the detail, I find social taxes booked to supplemental retirement plans, and profit sharing put into commissions. Some nuances may down to local translation issues, but really that is no excuse. Sigh. It is like putting together a giant picture puzzle.
William keeps pinging me for an update. While it is nice to look into those big blue eyes, there is not much either of us can do to move things on any quicker. In the end, I almost have to create a bottom-up estimate for each of the main elements included in fringe in order to verify the number. It really riles me that the benefits database we spent all that money on is useless in that respect. In the vague hope of improving things for next year, I fire off a load of corrections to be made to the benefits platform, and similarly, a list of coding corrections for the local finance teams to make to the actual costs booked in future.
In the end, I have spent about two days on budgets, and while working with William makes a nice change, it is not really part of my job description or objectives to manage cost administration, only to keep costs down. That gives me an idea. I can add a whole section on benefits cost management to my CV, and I add a new deliverable to my objectives to be assessed at year end.
This might even give me the justification I need to argue for a pay rise or even a bump in grade based on additional responsibilities. After all, that is what any of the Higher Beings in C-suite would do. All I am doing by self-serving in this way is showing characteristic leadership qualities. Whoever said that finance is boring?
Next time..Candid revisits the car policy
