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In: Accounting

Discuss the process of preparing a budget

Discuss the process of preparing a budget

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Expert Solution

PROCESS OF PREPARING BUDGET

Process of preparing Budget refers-:

  1. The Financial service Department prepares worksheets to assist the department to head in preparation of budget estimates.
  2. The Administrators calls a meeting of managers and they present and discuss plans for the following years
  3. The managers work with financial services, or work alone to prepare estimate for the departments coming years   
  4. The completed budgets are presented by the managers to their executive officers for review and approval.
  5. The jurisdiction of budget request may be required in writing.

Mainly 5 steps to prepare budget -:

Obtaining estimation

Obtaining estimation of sales, production level, expected cost and availing of recourses from each sub-unit/division/department.

Coordinating estimation

In my organization, the budget committee evaluates the different plans submitted by various organizational units to determine the potentiality.

Implementing the budget plans

The final budget is presented to the managers concerned and adopted as the plan of operation of the coming budget period.

Reporting interim progress towards budgeted objectives

As a feedback of budgeting process, performance reports are prepared to inform departmental managers and top management about the performance achieved in terms of budgeted figures.

ekkarill92 answered 1 year ago
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