Define budget in management9/26/2023 “A financial and/or quantitative statement, prepared and approved prior to define period of time, the policy to be pursued during that period for the purpose of attaining a given objective."Īccording to Brown and Howard of Management Accountant "a budget is a predetermined statement of managerial policy during the given period which provides a standard for comparison with the results actually achieved." The Chartered Institute of Management Accountants, England, defines a 'budget' as under: It is a versatile tool that have helped chief executives of organizations and their management (managers) cope with many day to day problems confronting the running of the organization which including but not limited to inflation, changing government policies in terms of regulations and sometimes uncertainties of time/business environment. One of the greatest aid to good management that has ever been devised is the use of budgets and budgetary control to guide an organization to efficient finance/operational/activity management. The technique of budgeting is an important application of Management Accounting. Through the budgets, a business wants to know clearly as to what it proposes to do during an accounting period. ![]() It is employed, no doubt, in large businesses, but even the small businesses are using it at least in some informal manner. ![]() ![]() Budgeting has come to be accepted as an efficient method of short-term and long-term planning and control.
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