Budgeting is a multi-phased process. For the overall budgeting procedure to be successful, each phase of the process must be executed in the proper manner. Therefore, stringent administrative controls are imperative in the process. If a budget is prepared but no follow-up assessments and evaluations are carried out to establish effectiveness of its implementation, the whole process may go awry and negate the entire purpose of putting the budget in place (Cogan, Timothy, & Allen, 1994). Various types of controls are necessary for a budget to achieve its objectives; these include preventive controls, variance analyses, feedback controls, and internal controls. All these controls must be factored in for the administration and execution of the budget to be effective. Proficient personnel who can identify and mitigate sources of variances in the budget execution process are needed to oversee the process. Allowing the formulated budget to run itself would plunge an organization into a budget crisis. To prevent any such crisis from arising, this paper will look into the features of budget administration/execution that make an organizational budget successful (Lee & Ronald, 1998).
Introduction
A successful budget calls not only for proficient measures in its preparation but also for stringent measures to oversee its administration/execution. This is because of the many counterforces that bombard the budget system. These counterforces include, for example, unscrupulous officials who would like to use the budget funds inappropriately; involuntary mistakes, such as miscalculations, that would overstate or understate the budgeted figures can also occur. To prevent these eventualities from disturbing the budgeting process, stringent administ...
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...that the budget administration/execution process cannot be successful unless there are stringent controls in place to ensure that disadvantageous disturbances do not occur to the budget as formulated. This is because there are many forces that can affect the budget administration process. Some of the forces are voluntary while others are involuntarily sparked, both of which need to be handled with stringent administrative measures. Voluntary flaws to a are introduced by unscrupulous individuals who want to reap benefits from the budget; to curb this, the budget administration team should ensure that the execution of the budget is done by credible people with the right expertise. The budget administration team should ensure that measures, such as maintenance of proof and accurate records, are implemented to prevent involuntary errors to the budget control process.
Mikesell, J. L. (2010). Fiscal administration: Analysis and applications for the public sector (8th ed.: 2010 custom edition). Mason, OH: Cengage Learning
For government budgeting to be effective, the process that guides it must be an evolving one. As the government gets bigger, it will most likely destabilize the existing method. Therefore, it must change to keep pace with the demands and growth of the country. The process must be capable of handling the complexity of our nation and its multifaceted needs so it will always need revisions and restructuring to face these new challenges. Its ultimate goal must be to reinforce the government and strengthen the country.
“After World War I, such arguments succeeded in rationalizing the budget process under the president’s authority: the 1921 Budget and Accounting Act gave presidents responsibility for overseeing individual agencies budget requires and unified; coordinated executive budget. A new organization, the Bureau of the Budget (BoB), was created within the Treasury Department to serve as the administration’s staff arm in endeavor” (Rudalevige,
A company's budget serves as a guideline in planning and committing costs in order to meet tactical and strategic goals. Tactical goals such as providing budgetary costs for daily operations, and strategic objectives that include R&D, production, marketing, and distribution are all part of the budgeting process. Serving as a guideline rather than being set in stone, the budget is a snapshot of manager's "best thinking at the time it is prepared." (Marshall, 2003, p.496) The budget is a method in which to reign-in discretionary spending, and will likely show variances between what costs have been anticipated and what costs are actually incurred.
The 2015 Federal Budget is part of the Government’s Economic Action Strategy to return the budget and erect a robust and prosperous economy. The ‘Budget’ marks a major erect by the Government to transform the role of state in companions’ lives. The Government will effort to supply equality of turn for all Australians and to redirect taxpayers’ dollars from unaffordable consumption today to productive vestment for the futurities, while support a strong safeness snare. The substantial savings decisions in this Budget put Australia back on vestige to a sustainable and responsible stiff position, with surpluses scheme to construct to well over one per cent of GDP by 2024-25, taking into calculation by and by toll remedy.
Resistance will occur and if it is believed that the organization/agency does not represent the public/clients overall interests. Transparency and openness of public budgets promote social accountability and restores the total confidence in the program or government. Enabling citizens/clients to become more engaged and, in the process, learn more about the budget and fiscal policy concerns. With the learning process acceptance of the hard budget choices and cynicism should dissipate bringing with it trust.
Everyone has their own political leaning and that leaning comes from one’s opinion about the Government. Peoples’ opinions are formed by what the parties say they will and will not do, the amounts they want spend and what they want to save. In macroeconomic terms, what the government spends is known as fiscal policy. Fiscal policy is the use of taxation and government spending for the purposes of stimulating or slowing down growth in an economy. Fiscal policy can be used for expansionary reasons, which is aimed at growing the economy and increasing employment, or contractionary which is intended to slow the growth of an economy. Expansionary fiscal policy features increased government spending and decreases in the tax rates as where contractionary policy focuses on lowering government spending and increasing tax rates. It must be understood that fiscal policy is meant to help the economy, although some negative results may arise.
In high school, typical American teenagers learn the history of our country, what the meaning of SIN is, and how to annotate classical English literature. As varied as education from school to school is, there are specific guidelines that every state adheres to, yet the education that is given is still lacking. Teens graduate knowing how to find the height of the right triangle when they are given an angle and the opposite side but an important life skill is not taught — how to manage one’s finances and do their own taxes. If a teenager chooses to go to college, they have to tackle the troubles of student loans, and later, student debts. The reality of the situation is that students arriving in college still rely heavily on their parents
Cost accounting system: a systm that estimates the cost of goods and services, as well as the cost of organisational units, such as departments.
Every government entity has a primary goal, which is to be as efficient and effective as possible while expending the smallest amount of resources. In addition, the resources expended cannot be more than the resources received as revenues. The budgeting process is a tool that assists government entities in being both efficient and effective. Before a budget can be adequately prepared, you must first understand the budgeting concept and secondly be knowledgeable of budget types.
Another reason for importance of participatory budgeting is that of enhancing transparency. There is an important inextricable link between budget public engagement and fiscal transparency. Participatory budgeting allows access of adequate information which cannot be provided by traditional political institutions, (WorldBank, 2003). When there is lack of transparency in the budgetary process bureaucrats tend to misuse public fund making policies choices that are exclusive to the citizens, (www.bidpa.bw,
After one month of tracking my income, I have learned a little more about my spending habits. I am already aware of most of my spending habits, and where I most often slip up. A little on the background of my spending, I rarely use cash. There are two reasons why I do this; the first reason is so that I am not tempted to spend bits of money here and there on snacks and small things. The other reason is that so I can more effectively track my spending with less effort. I have two checking accounts to keep this balanced since on the statements it does not say what the money is specifically spent on. I use one card on essentials and school needs, and the other account is more of a lifestyle account. Although I have done this financial tracking in the past, I was able to reaffirm that I still have some areas of weakness in my spending.
It requires an adequate and sound organizational structure, that is, there must be a definite assignment of responsibility for each function of the enterprise. Budgeting compels all the members of management, from the top to bottom to participate in the establishment of goals and plans. Budgeting compels departmental managers to make plans in harmony with the other departments and of the entire enterprise. Budgeting helps the management to put down in figures what is necessary for a satisfactory performance. Budgeting helps the management to plan for the most economical use of labor, material and capital. Budgeting tends to remove the cloud of uncertainty that exists in many organizations, especially among lower levels of management, relative to basic policies and objectives. Budgeting promotes an understanding among members of management of their co-workers' problems. Budgeting force management to give adequate attention to the effects of general business conditions. Budgeting aids in obtaining bank credit as banks commonly require a projection of future operations and cash flows to support
Yes, I was being honest when I was charting my spending habits because I haven’t done a budget that lasted a week before, and I wanted to get an estimate of how much I spend in a week. It was an interesting task to be aware of how much I was actually spending by having real numbers to look at in an organized spreadsheet. The spreadsheet itself was very simple and direct which made it easier to analyze. By lying about my spending habits, this assignment would have been counterproductive since I would have been avoiding facing the truth about how much I spent that week. Instead of being dishonest and trying to avoid that amount of money I spent, I was honest when I was charting my expenses since I wanted to get an actual estimate, even if this
Incrementalism has been the predominant theory of budgeting and has been defined in many ways. Scholars drawing on the works of Lindblom (1959), Wildavsky (1964), and others have shown that incrementalism is defined by budgetary outputs that it is almost never actively reviewed as a whole every year. Instead, it is based on last year’s budget with special attention given to a narrow range (5 to 10 percent) of increases or