SCOPE OF FINANCE FUNCTIONS

The functions of Financial Manager can broadly be divided into two: The Routine functions and the Managerial Functions. Managerial Finance Functions Require skilful planning, control and execution of financial activities. There are four important managerial finance functions. These are: a) Read More …

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Zero-Based Budgeting (ZBB)

Zero-Based Budgeting (ZBB): Zero based budgeting is a cost benefit approach where it’s assumed that the cost allowance for an item is zero and will remain so until the manager responsible justifies the existence of the cost item and Read More …

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Incremental budgeting

Incremental budgeting Before an annual budget is prepared, a base should be chosen from which the process will begin. The traditional approach is to base the current budget on the current year’s results plus an extra amount for estimated growth Read More …

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Budget Setting Styles

1 Imposed style of budgeting In this style, senior managers prepare budgets with little or no input from operating personnel or operational managers. The budget is then imposed on the employees who have to work with the budgeted figures. Imposed Read More …

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BEHAVIORAL ASPECTS OF BUDGETS

Human behavior and budgetary planning and control An important feature in control in business is that control is exercised the managers over people. Their attitude and response to budgetary planning and control will affect the way in which the Read More …

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Types of budgets

Budgets can be classified as follows Functional budgets Sales budget Production budget Material usage budget Material purchase budget Labour cost budget Cash budget   Sales budget This is a forecast of sales in a given period both in quantity and Read More …

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