project budgeting

Objectives Of Budgetary Control

Budgetary control is the process of ascertaining several budgeted figures for the future of a business enterprise and then making comparison of these budgeted figures with the actual results for finding out discrepancies, if any. The comparison of budgeted and actual figures will allow the management to take curative actions at a proper time.

Budgetary control can be defined as, “A means of achieving the financial control of an entity whereby the actual results for a defined period of time are compared with the budgeted results, any differences (or variances) being noted, and some corrective action taken to bring the actual activities back into line with the budgeted ones if such variances need to be dealt with.”

The budgetary control is a continuous process that helps in planning, coordination and controlling of business decisions. A budget is a means and budgetary control is the end-result. The budgetary control system assists an organization in setting up the goals and efforts are made for its achievements. It enables economies in the enterprise. The main objectives of budgetary control are as follows:

- It is essential for planning, controlling and also acts as an instrument of coordination.
- It coordinates the actions of various departments.
- Budgetary control helps in eliminating wastes and raises the profitability position of a business enterprise.
- It makes a prediction about capital expenditure for future.
- It helps in amending deviations from the established standards.
- It centralizes the control system.
- Budgetary control operates various cost centres and departments with efficiency and economy.

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Submitted by admin on Thu, 2010-05-20 08:23.

Financial Management

A full service trading firm offering commodity and online futures to clients worldwide. Financial Management is one of the crucial functional areas of management, because the success of a company wholly depends on the proper use of its financial resources. The significance of financial management cannot be overstressed. Sound financial management is necessary in all organizations whether big, small or medium.

Financial Management is directly related with the managerial activities like raising and utilization of available funds in the best economic way. Financial management refers to that part of the management activity, which is concerned with the planning, and controlling of firm’s financial resources.

It deals with discovering diverse sources for raising funds for the firm. The sources must be appropriate and cheap for the needs of the business. The most appropriate use of such funds also forms a part of financial management. As a separate managerial activity, it has a recent origin. It is as useful to a small concern as to a big unit.

Financial management can be defined as the process of making financial decisions with the ultimate objective of maximizing the shareowners' wealth. In the world of finance, financial management is also known by other names like corporate finance, business finance and managerial finance. It is denoted as FM.

Financial activities should not be only limited to procurement of funds, but also to other prospects of funding like determining the financial needs, availability of funds, cost of financing, capital budgeting, preserving liquidity, loaning and borrowing policies and direction of fixed and current assets and evaluation of business firm.

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Submitted by admin on Thu, 2010-05-13 08:30.