Budgetary Control And External Control

1640 WordsMar 14, 20167 Pages
By drawing from relevant literature and examples, critically evaluate the use of budgetary control by managers in an age where organizations are facing increasingly unpredictable environments. In the following essay budget and budgetary control will be defined along with the objective of budgetary control. Moreover how the style of manager effect the uses budgetary control when facing increasing unpredictable environment will be analysed , alongside the advantages and disadvantages of budgetary control and budgets. Furthermore real life situation will also be used to explain varies factor relating to the changing environment. Firstly budget can be defined as “a quantitate expression of a plan of action and aid to coordinating and implementing the plan”(Horngren, Sundem and Stratton,2013). To add to this definition Collier(2006) also suggested profit is based on a defined level of activity and it takes into consideration of future time periods. budgets main purpose can be split into assisting managers in control and planning of the firm, moreover it also include sub factor such as acting as a communication device between departments. Furthermore jill collins definition for budgetary control is the process by which financial control is exercise by manager preparing budgets for revenue and expenditure for each function of the organisation in advance of accounting period. It also involve analysis of performance of department One of the factor which could evaluate the use of
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