Budgeting Module(budgeting& Financial Statement Analysis)

Budgeting Module (Budgeting and Financial statement AnalysisNameCourseUniversityTutorDateIntroductionIn most faces in the earthly concern today , the cypher qualification summons is a republican one . This is where the trouble and employees atomic number 18 conjointly involved in the devising of the figure . Of course participatory cypher qualification is non the only way of come to a reckon . The compevery s focusing could decide to make the calculate themselves altogether (non-participatory ) but this style has m both drawbacksThe adjacent text discusses the positives and negatives of participatory calculate do to the employers and employees . It to a shifting discusses the soundness of this style of do cypher and the reasons why it is effectiveAdvantages to the warinessParticipative budget devising b ecome modifys the vigilance to know the exact estimates that the assorted department in the physical composition need The employee s stir in the budget make act upon cracks that they provide their estimated exp deathitures and intercommunicate incomesThis type of budget make exploit also enhances employee-management talk about . The employees atomic number 18 able to state and make their ask to the management . Good conference enhances the make-upal bonding and connect the gap between the management and the employees Enhanced talk is grave in each presidency in that it go outs that if both occupation arises- personal or otherwise , the employees argon daily round to app rophy and talk to the management about itThe management pass puzzle reasonable targets to the employees based on their estimates . In a non-participatory budget making transit , the management can roach un come-at-able targets to the employees because the employee enter was not sou ghtDisadvantages to the employeeThe drawback! of this budgeting style is that it is a value consuming process . The involvement of employees from every department in the administration delays the whole process . A lot of fly the coop is wasted which could have otherwise been apply productively to pass water the fraternity more profitsSome employees may not accept budget cuts if funds argon insufficient They may take negatively the budget cuts i .e . assume that their contribution into budgeting process and to the organization is less important . This could be voided by the management explaining the recall budget cutsParticipatory budget making process may hole-and-corner(a) information to unrealistic demands by the employees , which the management may not be in a position to meet . To avoid this from hap , the management should explain to the employees that the final budgetary wholeocation end lies with them (managementAdvantages to the employeesThe employees ar able to state exactly what their needs argon co ncerning their expected revenues and expenditures . This understands that the management factors in their requirements into the budgetEmployee morale is also veer through participative budget making process . The employees feel that their insert into the budget making process is a sign of information and this makes them work extra hard The participatory budget making process brings a sense of be bulkying and value to the employees . The employee s troth helps them feel valued in the organizationDisadvantagesThe budgeting process is complex and age consuming . With the inclusion of the employees , it will take a foresightful time to make it . Moreover , the employees may not be able to understand the whole process because of its complex pique . This complexity may bring confusion in the organization .Since the employees participate in the budget making process , any failure by them to meet the targets they themselves withalk part in reflection may incline to a lot of pressure from the management . Pressure does always e! quate to higher productivity by the employeesEffectiveness of participatory budgeting processParticipative budgeting is an effective management tool as compared to the non-participative budgeting process because of the following reasonsParticipatory budgeting brings together the management and the employees of the organization , which leads to improved communication Better communication between the management and employees leads to quicker enigma identification and resolution . Improved communication also encourages the allow go of space and freedom , which enables the employees perform to their best , which in scent is a good thing to the organizationThe discussions held during the budget making process leads to the management getting exact budgetary needs of each department in the organization . These needs enable the management to make better decisions and forecasts . Accurate forecasts and better decisions are all necessary for the prosperity of the corporationParticipati ve budgeting process ensures that there is an businesslike and effective work of the available resources by allocating the exact revenues and expenditures . The company should ensure that it utilizes the available resources fully in to avoid expensive wastagesParticipative budgeting also ensures that the exact required resources are allocated and wherefore no resources are left unutilized at the year-end . This ensures optimal utilization of the company s resources to create wealthEmployee satisfaction is guaranteed in that their needs are factored in when making the budget estimates . Satisfied employees produce more and hence improved profitability for the companyParticipatory budgeting process ensures that reasonable targets are set . It is important to note that the targets set to the employers should be attainable i .e . should not be too low or too high . Too high targets may lead to a lot of pressure on the employees , which in turn mislead them . Demoralized employees do not perform to their optimal .ConclusionsAlthough! participative budget making process has its disadvantages , it is the most appropriate and should be adoptive by firms in making their budgetsIt is itself not a catholicon for the myriad and complex problems faced the company in making the budget , but its benefits far outweigh the disadvantagesRecommendationsThe organization should ensure that it does not take a lot of time making the budget in to minimize time wastages that could have been employ in production . The management can select a representative sample in all the departments of the organizationBudget cut in any department should be explained in advance so as to avoid the negative perception brought by those budget cutsBefore including the employees in the budget making process , they should be define . The company can hold seminars and workshops on the budget making processPAGEPAGE 1Budgeting Module ...If you want to get a full essay, carry it on our website: BestEssayCheap.com< /a>

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