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BizOps Enterprises has product sales as its main source of revenue with a typical income of $10-15 million per month (approximately 95 per cent of revenue). Its main expenses are wages and stock purchases, with a typical range of $8-9 million per month. All other expense items equate to approximately $1 million per month. The budgetary monitoring process attempts to track 20 income categories and up to 200 expense categories. Department managers claim that it takes a full working day per month to respond to all of the variances in their budget report.
Problem 1: Prepare a one-page submission to the Board with a proposal for department managers to focus only on responding to variances in budget items that have the greatest impact and risk to the organisation. The proposal should contain mock-up examples of typical monthly revenue and expenses
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