Budget Is Important For An Organization

1892 Words Aug 8th, 2015 8 Pages

Knowing what resources are available is important for an organization to function. The organization runs the risk of depleting resources or not using their resources effectively to accomplish the organizations mission if resources are not accounted for. According to Dr. Dean’s PowerPoint, budgeting is “the administrative activity of planning that determines what resources are needed and how they should be supplied/applied.” It should be noted that a budget is a planning tool. According to Robert Welch, “the administrative activity of budget was listed last of the seven elements that made up the process of planning,” he proposes his reasoning, “For if planners seek the mind of God in establishing their objectives and the parameters…then money will not be a problem because God will empower that which He wants done in the church or religious organization” (Welch, 167). It is wise for a church to develop a budget, thereby ensuring that they are being good stewards of their resources. There are three basic budgets to operate by. The government and military use a zero-based budget. Every year the budget starts at zero. Each budget unit must be justified for the next year. The key advantage to this system is that each budget unit is reviewed and analyzed every year (welch, 168). This allows the organization to determine if more or less resources should be requested in regard to the budget item. It also allows the organization to assess the need for the budget unit.…
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