Skip to main content

Effective Budgeting Skills & Abilities:


Effective Budgeting Skills & Abilities:

 As we know that budgeting is the official plan for a business success or some time the business leadership called it as a plan for the profit which leads the business to achieve its goals and objectives.

Actually a budget is a planned activity which is based on numerical figures like how much bugs or cash a business units allow to spend over production or services? Or how much they need to make as revenue? In a limited time period as in limited budgeted resources that’s all activity is planned in quantities units or figures. The role of the budgeting in the overall every business activity planning and evaluation is very important. We have many examples in the modern and classic history of the business operations. There are many projects which are admirable due to good budgeting and management achieves a good will through their effective planning and efficiency in their skills or expertise.

There are many factors which are influencing over the organizations financial budgets they can be external and internal. For example in the case of external the market trends, customer influence, technological factors, market growth rate, product segmentation factor and the government rules and regulations and the other regulatory bodies like the chamber of commerce and the business competitors trends make their influential effects over the business financial budgets. There are many examples we have in the internal factors; internally the financial performance or budgets are affected with the management performance, production unit’s performance, labor issues and the leadership commitment to the objective and organizational missions.

The budgeting playing a very effective role to achieve the short term objective normally we take the operational budgeting in the short term budgeting because that always designed for a short period of time or for a year. The Strategic budgets mostly designed by the board of directors after the finalizing of the business mission statement which is designed for more than or equal to the ten years we have the example of the Saudi Arabia here which adopted a new strategic vision which is globally know a the #Vision2030 designed by Crown Prince Muhammad Bin Salman or #MBS. The Intermediate budget are designed for two or less than two years know the Saudi Arabian government is working over the intermediate budget because the strategic main budget is announced in the shape of the Kingdom Vision and mission till the Financial Year 2030. Know the country second level leadership divide the vision and mission in parts and they are working over the first step which will be completed in the FY2020 or till FY2022. That intermediate budgeted plan is approved and they are liable to improve the Saudi Youth and making a cut over the luxurious items and expenses in the Kingdom.

The very admirable characteristic of the budgeting is that a budget is a tool for measuring the performance of a business unit’s managers and employees. That’s also providing the help to the leadership to make a very effective communication line between all the departments and business units to improve their performance and productivity and achieve the given results according to the give profit plan in the budgeted resources and budgeted financial aids.

Labels:

Comments

Post a Comment

Popular posts from this blog

Constant gross-margin percentage NRV method:

 According to this method determination of the gross margin percentage for all of the products. When we find out the overall gross margin percentage and subtract the appropriate gross margin form the final sales value of each product to calculate total costs for the product and at last to subtract the separate costs to arrive at the joint cost amount. Determination of the gross margin. “ Gleim’s   book 15 th edition for the CMA-USA students and Professionals  is the source of all the examples and this topic” 
1 comment
Read more

Methods of Joint Product & By-Product Costing:

 Joint Product Costing is techniques in which there are two or more products are produced with a common manufacturing process from a common process of input, which output from that manufacturing process, are known as joint products. The costs which incurred over this complete manufacturing is known as joint or common costs because the process output is in the shape of two or more than two products. But there is a point how we know that how much cost we need to spend over these separate products? At the Split-Off point where the products are being separate from the manufacturing process at these points when the cost incurred these costs are called Separable costs. For explaining these all methods we have many examples but the example which I am going to give there that is from the Oil sector. The Oil rigging is a process to produce the oil which a natural resource but during the producing process there are many other joint products which we abstract from this process the
1 comment
Read more

Terminologies of Insurance:

Terminologies of Insurance:             There are many terminologies and jargons normally used by the agents, brokers and bankers which are very helpful to understand the insurance policies and the operations related to them. These terminologies helps us to understand the whole processes.             Insurance : That protect us from the uncertainties of life events. It protect us and our families form the harms of these events which badly damage our life through uncertain events.             Insurer : Insurer are the companies which offer their insurance policies and people purchase their policies.              Insured : Insured is the policy holder in who’s name the policy is purchased is called the             insured.              Premium : This is the amount which one pays to the insurance company to purchase an insurance policy. In an insurance agreement  the risk is transferred from the insured to the insurer for which the latter charge
4 comments
Read more