Question

Do you think the problems are the same when it comes to budgetary accounting for a business or the government? what are those problems seen by you?

Answer 1

Unlike business, governments are taxing authorities. Hence they have to consider the supply, demand and market competition. So, any government entity have to predict the taxable circumstances to prepare the budget. In other hand, business orginisations decides what product or services they are going to offer; the promotional activities they are going to be involved; and then predict the possible market responses in various terms like sales or competitions. Business do not face the problem of manadatory spendings while budgeting, but government have the problem. Govenrments are bounded by some laws that makes them to spend for various funds like spending in national military, spending in social security of employees, welfare programs and many more. However, businesses aslo have some mandatory spendings, like Income tax, sales tax or employment taxes but it too little in comparison to government's.

Conclusion: However budgetary accounting is the same process for both businesses and government, but they have their own problem at budgeting, which cannot be the same.