Budgeting Can Be an Important Management Tool If Implemented Properly. Identify Several Positive Results When Budgets Are Used Properly. Since Budgets Affect People, Identify Several Negative Aspects If Budgets Are Not Implemented Properly.

916 words 4 pages
Budgeting can be an important management tool if implemented properly. Identify several positive results when budgets are used properly. Since budgets affect people, identify several negative aspects if budgets are not implemented properly. (20marks)

Identify several positive results when budgets are used properly.

1) Monetary Control
To implement a budget, it enables us to know more about finances control. A budget that give us a full idea on the amount of money that coming in and going out, and whether a budget surplus or deficit every month. An exact budget figure in result to empowering and assist us in decision making along with budgeting information. (Balle,2013)

2) Goal Setting and Planning
A set of proper budget enable a
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The period of time involved is lesser a well-designed budgeting process offered, employees know well the process, and the organization uses budget software. The time necessity are generally unusually large when there is a participative budgeting method set out, because this kind of a technique consists an unusually amount of workers. (Bragg,2013)

4) Just assumes financial results.
Budgets are basically engaged with the assigning of cash money to selected tasks, and the estimated result of business trading decisions - they will in no way integrate other personal complications, for example the quality of products and services provided to consumers. Alternative matters can be listed together with the budget, but this is not generally completed. (Bragg 2013)

5) Inaccuracy
A budget is based on a set of assumptions that are basically not too far distant from the functioning conditions under which it was invented. If the business environment transforms to any significant degree, then the company’s profits or expense structure may well change so substantially that real results will rapidly take off from the anticipation delineated in the budget. This condition is a specific situation if there is an unanticipated economic crisis, since the budget authorizes a certain


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