Budgetary Control

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Control is necessary to ensure that plans & objectives as laid down in the budgets are being achieved. For this purpose, a comparison is made between plans and actual performance. The difference between the two is reported to management for taking corrective action.

6. Performance Evaluation
A budget provides a useful means of informing managers how well they are performing in meeting targets they have previously helped to set.

Stages of the Budgeting Process
1) Communicating details of the budget policy guidelines to those people responsible for the preparation of budgets) Determining the factor that restricts output) Preparation of the sales budget) Preparation of functional budgets) Negotiation of budgets with superiors) Coordination review of budgets) Final acceptance of budgets) Ongoing review of budgets.

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