Modified Budgeting (MB) approach was implemented in 1990 through the issuance of Treasury Circular No. 11/1990 to overcome the weaknesses of Programme and Performance Budgeting (PPB). MB was regarded as the modification to PPB and it consisted of four important elements namely; expenditure target, programme agreement and exception report, a cycle of programme evaluation and a more generalised approach to expenditure control. The main concept behind MB is to 'let managers manage', and this concept was put into practise using a 'top-down' planning technique. However, MB has flaws in that it continued to place more emphasis on outputs than outcomes, and was driven more towards compliance than performance. Due to MB's shortcomings, Outcome-Based Budgeting (OBB) was developed and is still in use today. Among the objectives of OBB are to efficiently manage national resources and enhance public sector accountability.

Modified Budgeting (MB) approach was implemented in 1990 through the issuance of Treasury Circular No. 11/1990 to overcome the weaknesses of Programme and Performance Budgeting (PPB). MB was regarded as the modification to PPB and it consisted of four important elements namely; expenditure target, programme agreement and exception report, a cycle of programme evaluation and a more generalised approach to expenditure control. The main concept behind MB is to 'let managers manage', and this concept was put into practise using a 'top-down' planning technique. However, MB has flaws in that it continued to place more emphasis on outputs than outcomes, and was driven more towards compliance than performance. Due to MB's shortcomings, Outcome-Based Budgeting (OBB) was developed and is still in use today. Among the objectives of OBB are to efficiently manage national resources and enhance public sector accountability.

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

Chapter23: Flexible Budgeting (flexbud)

Section: Chapter Questions

Problem 3R

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