Question

Describe the purposes of budgeting for operations and identify the roles and responsibilities of those involved in the budgeting process. (at least 300 words)

Answer 1

Note : Answer is not lengthy, the answer is break into pints for your proper understanding .

• Answer :

Purposes of budgeting for operations -

• Budgeting is the process of creating a plan to spend your money. This spending plan is called a budget.
• The purpose of budgeting is basically to provide a model of how the business might perform, financially speaking, if certain strategies, events, plans are carried out. In constructing a Business Plan, the manager attempts to forecast Income and Expenditure, and thereby profitability.
• Purpose: This indicator measures the effectiveness of an organization or a program to match available resources with planned activities.
• Budgets may cover single activities (sub-budgets) or whole programs; a well-constructed budget allows for the "rolling up" of several sub-budgets into a total operating budget.

Roles and responsibilities of those involved in the budgeting process -

• Budget preparation and administration is a shared responsibility between the City Council, City Manager, Finance Department, department manager, division manager, and supervisor.
• Each plays an important role in the fiscal management system and the quality of and satisfaction derived from the fiscal management system is a direct result of the efforts of the several participants.
• Lack of attention, failure to follow procedures and/or poor follow through at any level can undermine the best fiscal management system.
• The City Council, City Manager, the Finance department, and department/division managers all play an important role in the creation of the budget.

Budgets generally fall into one of three categories.-

1. Capital budgets.
2. Financial budgets.
3. Operational budgets.