Limitations of budgetary control, Financial Management

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LIMITATIONS OF BUDGETARY CONTROL

1. It involves predicting the future which is not certain.

2. Market is continuously and dynamically evolving.  Hence budgets based on past data may not be relevant.

3. Over reliance on budget will result in complacence on the part of the employees.

4. Actually, gaining full co-ordination of all the employees may be difficult.

5. There may be conflict between many departments.

6. Preparation of a budget is so difficult.

7. Resistance in accepting also will not result in achieving the set goals.

8. It is very expensive.


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