“Budgets assist in the planning, coordination and control element of an organization.” Explain. Having budget management forces the estimation of future economic conditions on a systematic basis. It also forces managers to develop an overall direction for the organization, anticipate potential problems, and develop future policies, for budgets convey information about the capabilities of the organizations resources, therefore better decisions are made possible. For example, knowledge of expected revenues and expenses and cash flows can …showed first 75 words of 410 total…

…showed last 75 words of 410 total…persist in the future and objectives are achieved. It’s also beneficial to the organization that the comparisons of actual results with budgeted results are done on a periodic basis (e.g., monthly) so those potential problems are detected early. As a result all types of businesses big or small benefit from preparing formal written plans for future operations by using the budgets to help management plan, coordinate and control the operations within the organisation.