Budgeting Decision For Local Management Essay

1333 Words 6 Pages
Budgeting is one of the most basic strategies that any number of groups and organizations depend on for financial planning. Families use budgeting to renovate their house, businesses use budgeting to continue providing their services: overall, budgeting is a necessity to insure that sufficient assets are available. Furthermore, budgeting is often used as a measuring tool based on variances between expected and realized expenditures (Atkinson, Kaplan, Matsumura, & Young, 2012). However, the effectiveness of traditional budgeting is widely disputed. Unfortunately, traditional budgeting methods are often unreliable in unstable market conditions, or highly fluid competitive environments. Furthermore, while traditional centralized management can be efficient, it does limit the contribution of local management and expertise to budgeting decision (Neil Kokemuller, Demand Media, 2015). In lieu of traditional methods, flexible arrangements (broadly described as “beyond budgeting”) practices are suggested to cope with these shortcomings. As they are, budgeting practices consume a large portion of organizations’ time and resources, leading some to suggest a drastic overhaul of budgeting in its entirety. Lamentably, the majority of budget related news revolve around the inability for various governments, especially our own, to balance their respective budgets. The United States budget is the result of an immensely complex debacle, which allots varying financial assets to a multitude…

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