Functions Of A Budget Function Essay
1) Identify five different functions of a budget. Briefly explain each function (5 mark)
Budget has five different functions: Planning; Facilitating communication and coordination across the organisation; Allocation resources; Controlling profit and operations; Evaluating performance and providing incentives.
Planning: Planning is the first step for the business budget function. It is also control all daily action and long-term develop with 5 or 10 years in the future business. The planning almost focus on reduce the expenditure. When your business have more scale, you must put your idea to a formal plan and definite the costumer type, cleanly money budget and how to service the target costumer (Planning, 2015). Such as forecasts, it is important part include by planning, is about accurately predict the future directions, it need precision information and knowledge (Forecasting, 2015).
Facilitating communication and coordination across the organization: The manager should be asked the members of the team when preparing the budget. It is important to the manager hold the team to achieve the goal. If they did not have communication and coordination, team members may be too difficult to achieve (Sharing Goal, 2015).
Allocation resources: It is process and strategy in the company to make a decision. They indicate the level of difference departments have limited budgetary allocations. Without allocation resources, expenditures will be extending the income…