Organisation Budget
ASSUMPTION
I will be doing this assignment with the following assumption. * That the company does not have accurate budget * That Rada plc have different departments of their business in different area of the world.
For an organisation not to have an accurate budgeting is like working without any plan because budget take an important role in the day to day running of a business and also most importantly the future. Budget is important for the following reason * Planning of annual operation * Coordinating the activities of various part of organisation and ensuring that the parts are in harmony with other * Communicating plan to the various responsibility centre manager * Motivating managers to strive to achieve the organisation goals * Controlling activities * Evaluating the performance of a manager.
There are different types of budget and the include 1. Rolling budget 2. Incremental budget 3. Zero Based Budget 4. Activity Based Budget.
* Rolling budget According to black hall publishing website rolling budget is a twelve month budget that is prepared many times in a year. The main reason of a rolling budget is to allow the management opportunity to forecast accurately and also to be able to revise its plan and also to plan for the next few months. The balance for using extra administrative cost and effort to produce several budget instead of one will come from making more accurate and forecasting and planning. ( Blackhallpublishing .com, October 2010). These are the advantages and disadvantages given by the black hall publishing
ADVANTAGES
* As a result of being assessed regularly thus make it more accurate and realistic. * Because the budget is revised regularly and as a result reduced uncertainty. * Any planning and control done will be base on updated plan because of its regular revision. * It will always extend a number of months ahead because of it is continuous.
DISADVANTAGES
I will be doing this assignment with the following assumption. * That the company does not have accurate budget * That Rada plc have different departments of their business in different area of the world.
For an organisation not to have an accurate budgeting is like working without any plan because budget take an important role in the day to day running of a business and also most importantly the future. Budget is important for the following reason * Planning of annual operation * Coordinating the activities of various part of organisation and ensuring that the parts are in harmony with other * Communicating plan to the various responsibility centre manager * Motivating managers to strive to achieve the organisation goals * Controlling activities * Evaluating the performance of a manager.
There are different types of budget and the include 1. Rolling budget 2. Incremental budget 3. Zero Based Budget 4. Activity Based Budget.
* Rolling budget According to black hall publishing website rolling budget is a twelve month budget that is prepared many times in a year. The main reason of a rolling budget is to allow the management opportunity to forecast accurately and also to be able to revise its plan and also to plan for the next few months. The balance for using extra administrative cost and effort to produce several budget instead of one will come from making more accurate and forecasting and planning. ( Blackhallpublishing .com, October 2010). These are the advantages and disadvantages given by the black hall publishing
ADVANTAGES
* As a result of being assessed regularly thus make it more accurate and realistic. * Because the budget is revised regularly and as a result reduced uncertainty. * Any planning and control done will be base on updated plan because of its regular revision. * It will always extend a number of months ahead because of it is continuous.
DISADVANTAGES
Bibliography: * Collin Drury (2009) Management Accounting For Business * www.denniscaplan.factcow.com, October 2010 * www.blackhallpublishing.com , October 2010 12: 30 * www.tutor2u.com, October 2010. 11:10