Budget Analysis and Budgetary Control
About Budget Analysis and Budgetary Control
Budgetary
control is a tool for the management to allocate responsibility and
authority in planning for future and to develop a basis of measurement
to evaluate the efficiency of operations.
Budgetary control helps
in coordinating the economic trends, financial position, policies,
plans, and actions of an organization.
Budgetary control also
helps the management to ensure and control the plan and activities of
the organization. Budgetary control makes it possible by continuous
comparison of actual performance with that of the budgets.
Why is Budget Analysis and Budgetary Control important?
There are a number of advantages to budgeting and budgetary control, which are
•
Compels management to think about the future, which is probably the
most important feature of a budgetary planning and control system.
Forces management to look ahead, to set out detailed plans for achieving
the targets for each department, operation and (ideally) each manager,
to anticipate and give the organisation purpose and direction.
• Promotes coordination and communication.
•
Clearly defines areas of responsibility. Requires managers of budget
centres to be made responsible for the achievement of budget targets for
the operations under their personal control.
• Provides a basis
for performance appraisal (variance analysis). A budget is basically a
yardstick against which actual performance is measured and assessed.
Control is provided by comparisons of actual results against budget
plan. Departures from budget can then be investigated and the reasons
for the differences can be divided into controllable and
non-controllable factors.
• Economises management time by using the management by exception principle.
Who should take the Budget Analysis and Budgetary Control Exam?
• Business owners
• Entrepreneurs
• Finance Managers
• Planning/Budget Controllers
• Cost Controllers
• Middle Management officers in Planning /Budgeting
• Financial and Product Control
• Finance Business Partners
• Management, Statutory and Regulatory Reporting
• Auditors and Internal Control
• Accountants and Consultants
• Students
Budget Analysis and Budgetary Control Certification Course Outline
1. Material Cost
2. Labour Cost
3. Direct Expenses and Overheads
4. Budget, Budgeting and Budgetary Control
5. Costing Systems
6. Marginal Costing
7. Standard Costing