A budget is a financial plan for a specified period of time, usually one year. It may also include planned sales volume and earnings, amount of resources, costs and expenses, assets, liabilities, and cash flows. Companies, governments, families, and other organizations use it to express a strategic plan of events or events in terms of measurable.
A budget is the amount of money allocated for a particular purpose and a summary of the intended expenditure along with a proposal for how to achieve it. This may include a budget surplus, providing money for future use, or a deficit in which expenditure exceeds revenues.
Video Budget
Etymology
The budget (derived from the ancient French word meaning wallet) is a quantified financial plan for the upcoming accounting period.
Budget is an important concept in microeconomics, which uses the budget line to illustrate a trade-off between two or more items. In other terms, the budget is an organizational plan expressed in monetary terms.
In short, the purpose of budgeting tools:
- Tool provides an estimate of revenues and expenses, that is, building models of how businesses can work financially if certain strategies, events, and plans are done.
- Tool enables the actual financial operation of the business to be measured against estimates.
- Finally, the tool sets cost limits for projects, programs, or operations.
Maps Budget
Company
Corporate budgets are often compiled every year, but may not be the final budget, usually requires great effort, are plans for short-term futures, usually allowing hundreds or even thousands of people in different departments (operations, human resources, IT, etc.) To include the income and expenditure they expect in the final budget.
If the actual figures conveyed through the budget period approximate the budget, this indicates that managers understand their business and have managed to drive it in the intended direction. On the other hand, if the numbers deviate wildly from the budget, this sends signals 'out of control', and share prices can suffer. Campaign planners spend two types of costs in each campaign: the first is the human resource cost required to plan and implement the campaign. The second type of spending that campaign planners charge for is the hard cost of the campaign itself.
Event management
A budget is a fundamental tool for an event director to predict with reasonable accuracy whether the event will result in a profit, loss or break-even. Budgets can also be used as a pricing tool.
There are two basic approaches or philosophies, when it comes to budgeting. One approach is to tell you about mathematical models, and the others in people.
The first school of thought believes that financial models, if properly constructed, can be used to predict the future. The focus is on variables, inputs and outputs, drivers and the like. Time and money investments are devoted to refining these models, which are typically held in some types of financial spreadsheet applications.
Other schools of thought argue that this is not about models, but about people. No matter how sophisticated the model is, the best information comes from people in the business. Therefore the focus is to involve managers in business more fully in the budget process, and build accountability for results. Companies that adhere to this approach have their managers develop their own budgets. While many companies will say that they do both, in fact the investment of time and money falls precisely in one approach or another.
Government
The government budget is a summary or plan of the intended income and expenditure of the government. There are three types of government budget: operating budget or current budget, capital or investment, and cash budget or cash flow.
United Kingdom
The budget is prepared by a Treasury team led by Chancellor of the Exchequer and presented to Parliament by the Minister of Finance on Fiscal Day. It was customary for the Chancellor to stand on No. 11 Downing Street with his team for the media to get photographic photographs from the Delivery Box, shortly before they went to the House of Commons. Once presented in the House of Commons is debated and then selected. However, small changes can be made to the budget written and presented by a party with a majority in the House of Commons (Government), Whips will ensure that it is ratified as written by the Chancellor.
United States
The federal budget is prepared by the Office of Management and Budget, and submitted to Congress for consideration. Always, Congress made many substantial changes. Almost all US states are required to have a balanced budget, but the federal government is allowed to run the deficit.
India
India's first budget was handed over on February 18, 1869 by James Wilson. James Wilson is known as the father of the Indian budget. The Minister of Finance is the head of the budget-making committee. The budget is prepared by the Budget Division of the Ministry of Economic Affairs of the Ministry of Finance every year. This includes extra excessive grants and when the President's proclamation of the failure of the Constitutional machinery operates in conjunction with the State or Territory of Unity, the preparation of the State Budget. India's current finance minister is Arun Jaitley.
Philippines
The Philippines budget is considered the most complicated in the world, combining multiple approaches in a single budget system: line items (budget execution), performance (budget accountability), and zero-based budgeting. The Department of Budget and Management (DBM) prepares the National Expenditure Program and passes it to the Committee on Appropriations of the House of Representatives to produce a General Appropriation Bill (GAB). GAB will go through budget and voting discussions; a similar process occurs when GAB is transmitted to the Philippine Senate.
After the two Congressional assemblies approve the GAB, the President signs the bill into the General Use Act (GAA); also, the President may elect to veto the GAB and return it to the legislative branch or abandon a non-signed bill for 30 days and move to law. There are two types of budget invoicing veto: veto line items and voices throughout the budget.
Personal or family
A personal budget or a home budget is a financial plan that allocates future personal income to expenditure, savings, and debt payments. Past expenditures and personal debt are taken into account when creating a personal budget. There are several methods and tools available to create, use, and customize your personal budget. For example, a job is a source of income, while bills and lease payments are fees.
There are many information sites and software available for use in personal and family budgeting.
Type
- Sales budget - future sales forecasts, often grouped into both units. This is used to create company goals and sales.
- Production budget - the approximate number of units to be produced to meet sales goals. The production budget also estimates the various costs involved with making these units, including labor and materials. Made by a product-oriented company.
- Capital budget - is used to determine whether long-term organization investments such as new machines, replacement machines, new plants, new products, and research development projects are worth pursuing.
- Cash flow/cash budget - predicted future cash receipts and expenses for a certain period of time. Usually includes periods in the short term. The cash flow budget helps the business to determine when the income will be sufficient to cover expenses and when the company will need to seek outside financing.
- Marketing budget - the estimated funds needed for promotion, advertising, and public relations to market a product or service.
- Project budget - the cost prediction associated with a particular company's project. These costs include labor, materials, and other related costs. Project budgets are often broken down into specific tasks, with assigned budget assignments for each. A cost estimate is used to set a project budget.
- Income budget - consists of revenue from government revenues and expenditures that are met from this income. Tax receipts consist of taxes and other duties imposed by the government.
- Budget expenditure - including the expenditure of data items..
- Budget Flexibility - set for fixed costs and variable rate determined per activity size for variable costs.
- Allocation budget - the maximum amount set for a specific expenditure based on management considerations.
- Performance budget - mostly used by organizations and ministries involved in development activities. This budget process takes into account the outcome.
- A zero-based budget - This has a clear advantage when limited resources must be allocated carefully and objectively.
References
External links
- Definition of budget dictionary in Wiktionary
- Media related to Articles in Wikimedia Commons
- Budget related citations in Wikiquote
- Origin of the word
Source of the article : Wikipedia
0 Comments