TABLE OF CONTENTS You can fool all the people all the time if the advertising is right and the budget is big enough.
Joseph E. Levine, quoted in Halliwell's Filmgoer's Companion, 1984.
A budget is a detailed estimate of future transactions. It can be expressed in terms of physical quantities, money or both. The essence of a budget is that it is a target set for management to keep within, achieve or surpass. Thus, a budget is always associated with a specific departmental responsibility point or centre within the organisation. This might be a division that has a sales budget, a factory with a capital budget or an individual with an expense budget.
Budgetary control is not limited to commercial and industrial firms attempting to produce a profit. The procedures involved are equally applicable to not-for-profit organisations such as government departments, universities and charities.
All aspects of the business or organisation can be budgeted. There might be income and expenditure budgets, cash budgets, capital budgets, research and development budgets to mention only a few examples. Budgets can be classified as master budgets, departmental budgets or functional budgets. Whatever level or degree of detail, a budget is useless if it does not focus on a point of responsibility.
Budgeting is a management function that incorporates:
setting objectives
establishing detailed financial estimates
delegating specific responsibility
monitoring performance
reacting to...
