A budget is a scheme of income and expenses of a certain entity (state, enterprise, family), set for a certain period of time, usually a year. The budget is the most important concept of both macroeconomics (state budget) and microeconomics (personal and family budget, enterprise budget).
Instructions
Step 1
The state budget is the country's most important financial plan. It includes the totality of estimates of all departments, government programs, government services, etc. It indicates the needs that need to be met at the expense of the state, as well as the sources of funds.
Step 2
From the point of view of the enterprise, the budget is an agreed and balanced financial plan that combines the investment and financial activities of an economic entity and allows you to compare the results obtained with the costs incurred for the period as a whole, as well as for its individual parts.
Step 3
The budget as a financial plan has some peculiarities. It is always compiled for a certain period of time, most often a year. Consolidated budgets can be prepared for a longer period - from 3 to 20 years. Budgeting is based on projected values of future costs and revenues. The process of compiling it is rather complicated. It goes through several stages: from planning and approval to execution and control.
Step 4
In the budgeting process, several options for drawing up an income and expenditure scheme can be considered. This is done in order to trace possible options for the development of the market and production situation. As a rule, the budget does not reflect all items of expenditure; the most expensive items are highlighted. Each organization has its own. At the same time, when drawing up a budget, it should be borne in mind that the information in it must be suitable for making management decisions.
Step 5
When developing a budget for an enterprise, it is necessary to remember not only about internal factors (standards for the use of resources, the system of payment relations), but also external factors (market situation, price level, production technology), which the organization cannot influence. In this connection, the budgeting system at large enterprises is rather complicated. For the successful implementation of the budget, they require strict control and coordination of actions of all its executors.
