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Analysis Of Six Major Methods Of Enterprise Financial Budgeting
< p > < strong > 1, fixed budget < /strong > /p >
< p > < a href= > http://www.91se91.com/news/index_c.asp > fixed budget < /a > also called static budgeting is a budgeting method for determining the expected number of other projects based on the fixed amount of business in the budgetary period. That is to say, the budgetary cost and profit information based on the budgetary budget are determined on the basis of a predetermined level of business volume. Obviously, the prerequisite for budgeting on the basis of a fixed level of business in the future must be the consistency of estimated business volume and actual business volume (or very small difference). < /p >
< p > < strong > two, elastic budget < /strong > /p >
< p > elastic budget is based on the classification of cost (cost) habits, and based on the dependence between quantity, profit and profit, taking into account the possible changes in the volume of business during the planned period, a set of cost budgets for a variety of business volumes is worked out to reflect the level of cost that should be reflected in various business volumes. In budgeting, variable costs increase or decrease with the volume of business, while fixed costs remain stable within the scope of the relevant business volume. A set of budgets that can be adapted to any level of production and operation within the budgetary period are compiled according to a series of possible levels of expected business volume. Because this budget is adjusted with the dynamic adjustment of business volume, it is widely used and flexible, so it is called flexible budget or variable budget. < /p >
The advantages of < p > < a href= "http://www.91se91.com/news/index_c.asp > > elastic budget < /a > are: first, the wide budget range; two, the comparability is strong. Flexible budgets are generally applicable to budgetary items relating to the cost (cost) and profit of budgetary execution units. < /p >
< p > elastic budget < a href= "http://www.91se91.com/news/index_c.asp" > programming < /a >: < /p >
< p > (1) to determine a relevant range, between 70% and 110% of normal production capacity. < /p >
< p > (2) choose the measurement unit of business volume. < /p >
< p > (3) according to the method of cost analysis, the cost of an enterprise is divided into two categories: fixed cost and variable cost, and the cost function (y=a+bx) is determined. < /p >
< p > (4) to determine the budgeted amount of each level of business in the budget period. < /p >
< p > < strong > three, incremental budget < /strong > < /p >
< p > incremental budgeting refers to the method of budgeting by adjusting the original cost items based on the cost level of the base period combined with the level of budgetary business and the measures to reduce costs. The incremental budgeting method is relatively simple, but it is based on the past level, in fact, it is to admit that the past is reasonable and needs no improvement. Because the original cost item is retained or accepted without analysis, it may cause the unreasonable cost to continue to spend, but can not be controlled, resulting in unnecessary expenditure rationalization, resulting in budget wastage. < /p >
< p > < strong > four, zero base budget < /strong > < /p >
< p zero base budget, or zero bottom budget, means that when budgeting is made, all budgetary expenditures are based on zero point, regardless of their past situation. From the actual needs and possible starting points, we study and analyze whether budgetary expenses are necessary and reasonable, and make a comprehensive balance, so as to determine the budgetary cost. < /p >
< p > zero based budgeting is a method of budgeting cost budgeting which is different from the traditional incremental budgeting. When budgeting, all budgetary expenditures are based on zero basis. From the actual needs and possible starting points, the necessity, reasonableness and amount of expenditure of each kind of expenses are considered one by one, so as to determine the budgetary cost. Its basic practice is: < /p >
< p > (1) the relevant departments within the enterprise, according to the overall objectives of the enterprise and the specific tasks of each department, propose the nature, purpose and amount of various business activities and expenses incurred in the budget period. < /p >
< p > (2) cost-benefit analysis of various budgetary plans. That is to say, the cost and income of each business activity should be compared, and the gains and losses should be weighed so as to judge the reasonableness and priority of the expenses. < /p >
< p > (3) according to the objective needs of production and operation and the actual possibility of the supply of funds for a certain period of time, we should arrange the best arrangement for each item in the budget, allocate funds and implement the budget. < /p >
< p > (4) division can not delay the cost items and delay the cost items. When budgeting, the allocation of funds can be allocated according to the amount of funds that can be allocated within the budget period. The expenditure of non delaying cost items should be given priority. Then, according to the need and possibility, according to the priorities of the cost items, we can determine the expenses that can be delayed. < /p >
The advantages of < p > zero base budget are not restricted by the existing rules and regulations, and all costs are based on zero. This will not only reduce capital expenditure, but also make sure that the limited funds are used in the most needed places, so as to mobilize the enthusiasm and creativity of all sectors of staff, and do their best to make reasonable use of funds and improve efficiency. < /p >
The workload of < p > zero base budget is relatively large, and the budgeting of the budget will take a long time. In order to overcome this shortcoming, it is not necessary to compile budgets every year according to the zero base budget method. < /p >
< p > < strong > five, regular budget < /strong > /p >
< p > regular budget refers to a method of budgeting when budgeting is used as a budgetary period with a constant accounting period (such as calendar year). The advantage of this method is that it is easy to compare the actual number with the budget number, and is also conducive to the analysis and evaluation of the budget execution. Its disadvantages lie in: first, blindness. Because the regular budget is more than two or three months before the start of its implementation year, it is difficult to predict the later stage of the budget period, especially in the changeable market. Many data can only be estimated and blinded. Second, invariance. In the budget execution, many unexpected factors will hamper the guiding function of the budget, or even make it lose its function, and the budget can not be adjusted in the process of implementation. Third, discontinuity. The continuity of budget is poor. The regular budget only considers the operation activities of an accounting year, even if the revised budget is only for the remaining budget period, it will seldom consider the formation of artificial budget interruption for the next fiscal year. < /p >
< p > < strong > six, rolling budget < /strong > /p >
< p > rolling budget, also known as continuous budget, means that when budgeting is made, the budgetary period will be removed from the accounting period, and the budget will continue to be replenish the budget, and the budget period will be kept rolling for 12 months. Its characteristic is to link the budget period with the fiscal year and keep it for 12 months. In the past 1 months, we will adjust and revise the budget for several months according to the new situation, and add the next 1 months' budget on the basis of the original budget, so as to roll back by stages and continuously plan the future business activities in the form of budget. < /p >
The basic way of rolling budget is to keep the budget period for 12 months, and to increase the budget for 1 or 1 quarters at the end of every 1 months or 1 quarters, so that the budget can be kept for 12 months at any time, so it is called continuous budget for P. < /p >
< p > rolling budget can enable managers at all levels to maintain the consideration and planning of the whole 12 months in the future, so as to ensure the stable and orderly operation of enterprise management. < /p >
< p > rolling budget can overcome the blindness, invariance and discontinuity of the traditional periodic budget. In this sense, budgeting is no longer just a work carried out at the end of the year, but a measure closely integrated with daily management. < /p >
< p > < a href= > http://www.91se91.com/news/index_c.asp > fixed budget < /a > also called static budgeting is a budgeting method for determining the expected number of other projects based on the fixed amount of business in the budgetary period. That is to say, the budgetary cost and profit information based on the budgetary budget are determined on the basis of a predetermined level of business volume. Obviously, the prerequisite for budgeting on the basis of a fixed level of business in the future must be the consistency of estimated business volume and actual business volume (or very small difference). < /p >
< p > < strong > two, elastic budget < /strong > /p >
< p > elastic budget is based on the classification of cost (cost) habits, and based on the dependence between quantity, profit and profit, taking into account the possible changes in the volume of business during the planned period, a set of cost budgets for a variety of business volumes is worked out to reflect the level of cost that should be reflected in various business volumes. In budgeting, variable costs increase or decrease with the volume of business, while fixed costs remain stable within the scope of the relevant business volume. A set of budgets that can be adapted to any level of production and operation within the budgetary period are compiled according to a series of possible levels of expected business volume. Because this budget is adjusted with the dynamic adjustment of business volume, it is widely used and flexible, so it is called flexible budget or variable budget. < /p >
The advantages of < p > < a href= "http://www.91se91.com/news/index_c.asp > > elastic budget < /a > are: first, the wide budget range; two, the comparability is strong. Flexible budgets are generally applicable to budgetary items relating to the cost (cost) and profit of budgetary execution units. < /p >
< p > elastic budget < a href= "http://www.91se91.com/news/index_c.asp" > programming < /a >: < /p >
< p > (1) to determine a relevant range, between 70% and 110% of normal production capacity. < /p >
< p > (2) choose the measurement unit of business volume. < /p >
< p > (3) according to the method of cost analysis, the cost of an enterprise is divided into two categories: fixed cost and variable cost, and the cost function (y=a+bx) is determined. < /p >
< p > (4) to determine the budgeted amount of each level of business in the budget period. < /p >
< p > < strong > three, incremental budget < /strong > < /p >
< p > incremental budgeting refers to the method of budgeting by adjusting the original cost items based on the cost level of the base period combined with the level of budgetary business and the measures to reduce costs. The incremental budgeting method is relatively simple, but it is based on the past level, in fact, it is to admit that the past is reasonable and needs no improvement. Because the original cost item is retained or accepted without analysis, it may cause the unreasonable cost to continue to spend, but can not be controlled, resulting in unnecessary expenditure rationalization, resulting in budget wastage. < /p >
< p > < strong > four, zero base budget < /strong > < /p >
< p zero base budget, or zero bottom budget, means that when budgeting is made, all budgetary expenditures are based on zero point, regardless of their past situation. From the actual needs and possible starting points, we study and analyze whether budgetary expenses are necessary and reasonable, and make a comprehensive balance, so as to determine the budgetary cost. < /p >
< p > zero based budgeting is a method of budgeting cost budgeting which is different from the traditional incremental budgeting. When budgeting, all budgetary expenditures are based on zero basis. From the actual needs and possible starting points, the necessity, reasonableness and amount of expenditure of each kind of expenses are considered one by one, so as to determine the budgetary cost. Its basic practice is: < /p >
< p > (1) the relevant departments within the enterprise, according to the overall objectives of the enterprise and the specific tasks of each department, propose the nature, purpose and amount of various business activities and expenses incurred in the budget period. < /p >
< p > (2) cost-benefit analysis of various budgetary plans. That is to say, the cost and income of each business activity should be compared, and the gains and losses should be weighed so as to judge the reasonableness and priority of the expenses. < /p >
< p > (3) according to the objective needs of production and operation and the actual possibility of the supply of funds for a certain period of time, we should arrange the best arrangement for each item in the budget, allocate funds and implement the budget. < /p >
< p > (4) division can not delay the cost items and delay the cost items. When budgeting, the allocation of funds can be allocated according to the amount of funds that can be allocated within the budget period. The expenditure of non delaying cost items should be given priority. Then, according to the need and possibility, according to the priorities of the cost items, we can determine the expenses that can be delayed. < /p >
The advantages of < p > zero base budget are not restricted by the existing rules and regulations, and all costs are based on zero. This will not only reduce capital expenditure, but also make sure that the limited funds are used in the most needed places, so as to mobilize the enthusiasm and creativity of all sectors of staff, and do their best to make reasonable use of funds and improve efficiency. < /p >
The workload of < p > zero base budget is relatively large, and the budgeting of the budget will take a long time. In order to overcome this shortcoming, it is not necessary to compile budgets every year according to the zero base budget method. < /p >
< p > < strong > five, regular budget < /strong > /p >
< p > regular budget refers to a method of budgeting when budgeting is used as a budgetary period with a constant accounting period (such as calendar year). The advantage of this method is that it is easy to compare the actual number with the budget number, and is also conducive to the analysis and evaluation of the budget execution. Its disadvantages lie in: first, blindness. Because the regular budget is more than two or three months before the start of its implementation year, it is difficult to predict the later stage of the budget period, especially in the changeable market. Many data can only be estimated and blinded. Second, invariance. In the budget execution, many unexpected factors will hamper the guiding function of the budget, or even make it lose its function, and the budget can not be adjusted in the process of implementation. Third, discontinuity. The continuity of budget is poor. The regular budget only considers the operation activities of an accounting year, even if the revised budget is only for the remaining budget period, it will seldom consider the formation of artificial budget interruption for the next fiscal year. < /p >
< p > < strong > six, rolling budget < /strong > /p >
< p > rolling budget, also known as continuous budget, means that when budgeting is made, the budgetary period will be removed from the accounting period, and the budget will continue to be replenish the budget, and the budget period will be kept rolling for 12 months. Its characteristic is to link the budget period with the fiscal year and keep it for 12 months. In the past 1 months, we will adjust and revise the budget for several months according to the new situation, and add the next 1 months' budget on the basis of the original budget, so as to roll back by stages and continuously plan the future business activities in the form of budget. < /p >
The basic way of rolling budget is to keep the budget period for 12 months, and to increase the budget for 1 or 1 quarters at the end of every 1 months or 1 quarters, so that the budget can be kept for 12 months at any time, so it is called continuous budget for P. < /p >
< p > rolling budget can enable managers at all levels to maintain the consideration and planning of the whole 12 months in the future, so as to ensure the stable and orderly operation of enterprise management. < /p >
< p > rolling budget can overcome the blindness, invariance and discontinuity of the traditional periodic budget. In this sense, budgeting is no longer just a work carried out at the end of the year, but a measure closely integrated with daily management. < /p >
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