BUDGET

Budget



Budget

Introduction

The study is related to the budget which is an important and essential element for the organizational activities. Budget is called the advance estimate of budget revenues and expenditures of an economic activity (personal, family, business, company, an office, a government) for a period, usually annually. It is a plan of action to meet a target, expressed in financial terms and values that must be met by a certain time and under certain conditions laid down; this concept is applied to each responsibility center organization. The budget is the annual development tool companies or institutions whose plans and programs are formulated within a year. In addition to this, in the budgeting process, the different types of budgets are the operating budget, the program budget, the cash flow budget and the capital budget.

Purpose of Study

The purpose of the study is to gain knowledge about the budgeting process, the following is the key objectives of the study;

- Budgeting enables companies, the governments; private organizations or families set priorities and evaluate the achievement of its objectives. To achieve these ends, it may be necessary to incur deficits which expenses exceed income or, conversely, it may be possible to save, in which case the budget will present surplus revenues exceed expenses.

- The budget may be charged or not, should not be accepted. The budget can be considered a classic part of the management cycle consisting of planning, action and control (or, more specifically, as part of a total management system.

- In the area of trade, budget is also a document or report that details the service will cost if done. Whoever does the budget should be adhered to him, and you cannot change if the customer accepts the service.

Excellent Budgeting Process is the Ability to Convert Objectives and Goals

In view of the financial planning and the financial reporting, the above statement that is, excellent budgeting process is the ability to convert goals and objectives into date, is correct.

Goal

The goal of the budgeting process includes the following;

- The main goal of the budget relates to the financial control of the organization.

- Budgetary control is the process of discovering what being done by comparing the results with the corresponding budgeted data to verify the achievement differences or remedy.

- Budgets can play both preventive and rehabilitative roles within the organization.

Objective

The budgets are useful in most organizations, utilitarian (business companies), non-utilitarian (government agencies), large (multinational conglomerates) and small businesses. The objectives of the budgeting process include the following:

- Budget items will serve as guidelines for the implementation of personnel programs in a given period, and serve as a standard for comparison once they have completed the plans and programs.

- Budgets are important because they help minimize risk in the operations of the organization.

- Through the budget remains the plan of operations of the company within tolerable limits

- The procedures induce advisory specialists to think about the total needs of companies, and to engage in planning so that they can be assigned to the various components and options ...