Organization of budgetary control, Cost Accounting

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Organization of Budgetary Control

Budgetary control ideally includes the given steps as:

1. The creation of budget centres.

2. The introduction of sufficient accounting records.

3. The preparation of organization charts.

This explains the functional responsibilities of all member of management.

A. The establishment of a budget committee as:

It will consist of financial and operating managers, who one will be essential to review, Discuss and co-ordinate business activities. The major function of this committee includes as:

  1. To issue instructions concerning budget requirements, deadline dates for the receipt of budgets.
  2. Draw up the budget preparation timetable. It obtains the form of network analysis whereby several activities are preceded via several others.
  3. To explain the common policies of management in relation to the budget.
  4. Checking initial problems and draft considered. Limiting factors are generally considered.
  5. Ensuring about the budgets is synchronized in the boundaries of available resources.
  6. To analyze comparison of budgets and real results and to recommend corrective action whereas essential.
  7. Review of budgets.
  8. Prepare or get ready the master budget after functional budgets have been prepared.
  9. The preparation of a budget manual. It is a document that sets out the responsibilities of the persons engaged in the routing of, and the forms and records essential for budgeting control. That manual will provide such information:

- Explanation of the system and its objectives.

- Definition of the duties and responsibilities.

- Reports and statements essential for each budget period.

- Deadline dates via that data are to be submitted.


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