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Budgeting: (Planning Project: (1. Identify obj: a)Mission b)Overall…
Budgeting:
Planning Project:
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3. Evaluate strategic options: Consider Suitability, Feasibility, Acceptability
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Purpose of budgeting:
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Conflicting roles: 1)Planning v Motivation: Demanding budgets may be unattainable and not suitable for planning 2)Planning v Performance evaluation: Budget based on past assumption whereas performance eval must compare reality to actual circumstances
Making the budget:
Budget period: 1)Annual too rigid 2)Quarterly better than annual 3)Rolling budget most flexible and provides relevant information but can be confusing for managers due to changing goals
Budget Admin: 1) Budget committee: Appoints budget officer who coordinates. HODs present budgets to com for approval 2)Acc staff: Assist in perparation, do not compile simply advise 3) Budget manual: Describes procedures and objectives of budgeting. Provides deadlines for submission
Budget process: 1)Comm details 2)Restricting factor 3)Sales budget 4)Prod budget 5)Negotiation 6)Coord & review 7)Acceptance 8)Monitoring
Types of budgets:
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ABB:
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Stages: a)Est output b)Est act demand c)Determine resources req d)Est quant of resources req e)Adj capacity of resources to meet supply
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