Controlling :
- As time passes, the actual performance of an operation can be compared against the planned targets. This provides prompt feedback to employees about their performance. If necessary, employees can use such feedback to adjust their activities in the future.
- Feedback received in the form of budget report from the responsibility centre. This report is helpful to know the performance of the concerned unit.
- Any unexpected changes into the conditions which were prevailing at the time of preparing budget are taken into account and budgets are revised to show true performance yardstick.
- Comparing actual results to the plan also helps prevent unplanned expenditures. The budget encourages employees to establish their spending priorities.
- The main objective of Budgeting is to help in achieving the overall objective of the organization.
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