The advantages and disadvantages of budgeting Essay.
The Public Budget Cycle The public budget cycle is applicable to organizations that operate based on a budget. There are four phases related to a budget cycle and each step is valuable. For example, with preparation, approval, execution, and evaluation of each step involved becomes a living document towards better understanding and helping to achieve the organization goals.
Excerpt from Essay: Budgetary Control Budgets and Budgetary Control: Benefits and Limitations Budgeting is a basic feature of business that is used by any business or company in order to set up a company's future endeavors by engaging in financial planning.These budgets are prepared for main areas of any business including: purchases, sales, production, labor, debtors, creditors, and cash.
A manager who is involved in budgeting and budgetary control must establish clear link between his budget and strategy. If the people to approve of the budget can see benefits clearly, it will be much easier for them swallow higher costs.( Brain Food: your route to the Top. Get a budget through in Management Today(dec 2,2004).
The Advantages and Disadvantages of Budgeting as a System of Organisational Control A budget is a short-term financial plan of income and expenses expected over a certain period of time (usually one year) used to achieve a businesses objective.
A control is a set of instructions that top leadership puts into place to prevent losses resulting from theft, fraud and technological malfunction. These instructions also help management ensure that expenses remain within budgetary limits.
The advantages of budgeting include the following: Planning orientation.The process of creating a budget takes management away from its short-term, day-to-day management of the business and forces it to think longer-term. This is the chief goal of budgeting, even if management does not succeed in meeting its goals as outlined in the budget - at least it is thinking about the company's.
Appropriate Budgetary Targets For An Organisation. Budgetary control is part of overall organisation control and is concerned primarily with the control of performance. The use of budgetary control in performance management has of late taken on greater importance especially as a more integrative control mechanism for the organisation.Discuss. “It’s clearly a budget.