This document discusses key concepts related to advanced management accounting including budgetary control, target setting and motivation, performance measurement, and behavioral impacts of budgetary control. It defines budgetary control as the process of preparing budgets for the future period and comparing actual performance to find variances. It also discusses flexed budgets, target setting, feedback and feed-forward control, and behavioral aspects such as motivational styles and dysfunctional behaviors that can arise from poorly designed budgeting systems.
After the preparation of Trial Balance, in the final stage of summarizing, Final accounts of the business are prepared which includes Trading, Profit & Loss A/c & Balance Sheet. Preparation of these statements & the various adjustments therein have been discussed here.
After the preparation of Trial Balance, in the final stage of summarizing, Final accounts of the business are prepared which includes Trading, Profit & Loss A/c & Balance Sheet. Preparation of these statements & the various adjustments therein have been discussed here.
1.1 identify the type of accounting
1.2 difference between Cost Accounting , Cost Accountancy and Costing
1.3 understand the Management information needs
1.4 identify the objectives of cost accounting
1.5 difference between Cost Accounting Vs. Financial Accounting
1.6 identify the role of cost accountant
This Presentation Includes Basic Definition Of Cost. Moreover You Will Also Get Knowledge About How Cost Accounting is Done. You Will Get Knowledge About Various Types Of Costs And Their Examples in Details. Note : This Presentation is Specially Made For The Engineering Student Who Has Subject Named Engineering Economics and Management
What's Behavior of an Organization
Who will take the Decisions
How decision will be taken
Type of organizations
Why different theories in Organizational Behavior were developed
Price elasticity of supply measures the relationship between change in quantity supplied and a change in price.
Basically elasticity of supply shows the amounts that costs rise as production increases
• When Pes > 1, then supply is price elastic
• When Pes < 1, then supply is price inelastic
• When Pes = 0, then supply is perfectly inelastic
• When Pes = infinity, then supply is perfectly elastic following a change in demand
1.1 identify the type of accounting
1.2 difference between Cost Accounting , Cost Accountancy and Costing
1.3 understand the Management information needs
1.4 identify the objectives of cost accounting
1.5 difference between Cost Accounting Vs. Financial Accounting
1.6 identify the role of cost accountant
This Presentation Includes Basic Definition Of Cost. Moreover You Will Also Get Knowledge About How Cost Accounting is Done. You Will Get Knowledge About Various Types Of Costs And Their Examples in Details. Note : This Presentation is Specially Made For The Engineering Student Who Has Subject Named Engineering Economics and Management
What's Behavior of an Organization
Who will take the Decisions
How decision will be taken
Type of organizations
Why different theories in Organizational Behavior were developed
Price elasticity of supply measures the relationship between change in quantity supplied and a change in price.
Basically elasticity of supply shows the amounts that costs rise as production increases
• When Pes > 1, then supply is price elastic
• When Pes < 1, then supply is price inelastic
• When Pes = 0, then supply is perfectly inelastic
• When Pes = infinity, then supply is perfectly elastic following a change in demand
Topics :
System and process of controlling
Budgetary and non-budgetary control techniques
Use of computers and IT in Management control
Productivity problems and management
Control and performance
Direct and preventive control
Reporting
Classification of budget according to Time, Function and Flexibility. Long term budget, Short term budget, Long term budget, Short term budget, Sales budget, Production budget
Financial Assets: Debit vs Equity Securities.pptxWrito-Finance
financial assets represent claim for future benefit or cash. Financial assets are formed by establishing contracts between participants. These financial assets are used for collection of huge amounts of money for business purposes.
Two major Types: Debt Securities and Equity Securities.
Debt Securities are Also known as fixed-income securities or instruments. The type of assets is formed by establishing contracts between investor and issuer of the asset.
• The first type of Debit securities is BONDS. Bonds are issued by corporations and government (both local and national government).
• The second important type of Debit security is NOTES. Apart from similarities associated with notes and bonds, notes have shorter term maturity.
• The 3rd important type of Debit security is TRESURY BILLS. These securities have short-term ranging from three months, six months, and one year. Issuer of such securities are governments.
• Above discussed debit securities are mostly issued by governments and corporations. CERTIFICATE OF DEPOSITS CDs are issued by Banks and Financial Institutions. Risk factor associated with CDs gets reduced when issued by reputable institutions or Banks.
Following are the risk attached with debt securities: Credit risk, interest rate risk and currency risk
There are no fixed maturity dates in such securities, and asset’s value is determined by company’s performance. There are two major types of equity securities: common stock and preferred stock.
Common Stock: These are simple equity securities and bear no complexities which the preferred stock bears. Holders of such securities or instrument have the voting rights when it comes to select the company’s board of director or the business decisions to be made.
Preferred Stock: Preferred stocks are sometime referred to as hybrid securities, because it contains elements of both debit security and equity security. Preferred stock confers ownership rights to security holder that is why it is equity instrument
<a href="https://www.writofinance.com/equity-securities-features-types-risk/" >Equity securities </a> as a whole is used for capital funding for companies. Companies have multiple expenses to cover. Potential growth of company is required in competitive market. So, these securities are used for capital generation, and then uses it for company’s growth.
Concluding remarks
Both are employed in business. Businesses are often established through debit securities, then what is the need for equity securities. Companies have to cover multiple expenses and expansion of business. They can also use equity instruments for repayment of debits. So, there are multiple uses for securities. As an investor, you need tools for analysis. Investment decisions are made by carefully analyzing the market. For better analysis of the stock market, investors often employ financial analysis of companies.
where can I find a legit pi merchant onlineDOT TECH
Yes. This is very easy what you need is a recommendation from someone who has successfully traded pi coins before with a merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi network coins and resell them to Investors looking forward to hold thousands of pi coins before the open mainnet.
I will leave the telegram contact of my personal pi merchant to trade with
@Pi_vendor_247
Empowering the Unbanked: The Vital Role of NBFCs in Promoting Financial Inclu...Vighnesh Shashtri
In India, financial inclusion remains a critical challenge, with a significant portion of the population still unbanked. Non-Banking Financial Companies (NBFCs) have emerged as key players in bridging this gap by providing financial services to those often overlooked by traditional banking institutions. This article delves into how NBFCs are fostering financial inclusion and empowering the unbanked.
US Economic Outlook - Being Decided - M Capital Group August 2021.pdfpchutichetpong
The U.S. economy is continuing its impressive recovery from the COVID-19 pandemic and not slowing down despite re-occurring bumps. The U.S. savings rate reached its highest ever recorded level at 34% in April 2020 and Americans seem ready to spend. The sectors that had been hurt the most by the pandemic specifically reduced consumer spending, like retail, leisure, hospitality, and travel, are now experiencing massive growth in revenue and job openings.
Could this growth lead to a “Roaring Twenties”? As quickly as the U.S. economy contracted, experiencing a 9.1% drop in economic output relative to the business cycle in Q2 2020, the largest in recorded history, it has rebounded beyond expectations. This surprising growth seems to be fueled by the U.S. government’s aggressive fiscal and monetary policies, and an increase in consumer spending as mobility restrictions are lifted. Unemployment rates between June 2020 and June 2021 decreased by 5.2%, while the demand for labor is increasing, coupled with increasing wages to incentivize Americans to rejoin the labor force. Schools and businesses are expected to fully reopen soon. In parallel, vaccination rates across the country and the world continue to rise, with full vaccination rates of 50% and 14.8% respectively.
However, it is not completely smooth sailing from here. According to M Capital Group, the main risks that threaten the continued growth of the U.S. economy are inflation, unsettled trade relations, and another wave of Covid-19 mutations that could shut down the world again. Have we learned from the past year of COVID-19 and adapted our economy accordingly?
“In order for the U.S. economy to continue growing, whether there is another wave or not, the U.S. needs to focus on diversifying supply chains, supporting business investment, and maintaining consumer spending,” says Grace Feeley, a research analyst at M Capital Group.
While the economic indicators are positive, the risks are coming closer to manifesting and threatening such growth. The new variants spreading throughout the world, Delta, Lambda, and Gamma, are vaccine-resistant and muddy the predictions made about the economy and health of the country. These variants bring back the feeling of uncertainty that has wreaked havoc not only on the stock market but the mindset of people around the world. MCG provides unique insight on how to mitigate these risks to possibly ensure a bright economic future.
The secret way to sell pi coins effortlessly.DOT TECH
Well as we all know pi isn't launched yet. But you can still sell your pi coins effortlessly because some whales in China are interested in holding massive pi coins. And they are willing to pay good money for it. If you are interested in selling I will leave a contact for you. Just telegram this number below. I sold about 3000 pi coins to him and he paid me immediately.
Telegram: @Pi_vendor_247
how to sell pi coins effectively (from 50 - 100k pi)DOT TECH
Anywhere in the world, including Africa, America, and Europe, you can sell Pi Network Coins online and receive cash through online payment options.
Pi has not yet been launched on any exchange because we are currently using the confined Mainnet. The planned launch date for Pi is June 28, 2026.
Reselling to investors who want to hold until the mainnet launch in 2026 is currently the sole way to sell.
Consequently, right now. All you need to do is select the right pi network provider.
Who is a pi merchant?
An individual who buys coins from miners on the pi network and resells them to investors hoping to hang onto them until the mainnet is launched is known as a pi merchant.
debuts.
I'll provide you the Telegram username
@Pi_vendor_247
Currently pi network is not tradable on binance or any other exchange because we are still in the enclosed mainnet.
Right now the only way to sell pi coins is by trading with a verified merchant.
What is a pi merchant?
A pi merchant is someone verified by pi network team and allowed to barter pi coins for goods and services.
Since pi network is not doing any pre-sale The only way exchanges like binance/huobi or crypto whales can get pi is by buying from miners. And a merchant stands in between the exchanges and the miners.
I will leave the telegram contact of my personal pi merchant. I and my friends has traded more than 6000pi coins successfully
Tele-gram
@Pi_vendor_247
when will pi network coin be available on crypto exchange.DOT TECH
There is no set date for when Pi coins will enter the market.
However, the developers are working hard to get them released as soon as possible.
Once they are available, users will be able to exchange other cryptocurrencies for Pi coins on designated exchanges.
But for now the only way to sell your pi coins is through verified pi vendor.
Here is the telegram contact of my personal pi vendor
@Pi_vendor_247
The Evolution of Non-Banking Financial Companies (NBFCs) in India: Challenges...beulahfernandes8
Role in Financial System
NBFCs are critical in bridging the financial inclusion gap.
They provide specialized financial services that cater to segments often neglected by traditional banks.
Economic Impact
NBFCs contribute significantly to India's GDP.
They support sectors like micro, small, and medium enterprises (MSMEs), housing finance, and personal loans.
How to get verified on Coinbase Account?_.docxBuy bitget
t's important to note that buying verified Coinbase accounts is not recommended and may violate Coinbase's terms of service. Instead of searching to "buy verified Coinbase accounts," follow the proper steps to verify your own account to ensure compliance and security.
Even tho Pi network is not listed on any exchange yet.
Buying/Selling or investing in pi network coins is highly possible through the help of vendors. You can buy from vendors[ buy directly from the pi network miners and resell it]. I will leave the telegram contact of my personal vendor.
@Pi_vendor_247
What price will pi network be listed on exchangesDOT TECH
The rate at which pi will be listed is practically unknown. But due to speculations surrounding it the predicted rate is tends to be from 30$ — 50$.
So if you are interested in selling your pi network coins at a high rate tho. Or you can't wait till the mainnet launch in 2026. You can easily trade your pi coins with a merchant.
A merchant is someone who buys pi coins from miners and resell them to Investors looking forward to hold massive quantities till mainnet launch.
I will leave the telegram contact of my personal pi vendor to trade with.
@Pi_vendor_247
how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
#pi #sell #nigeria #pinetwork #picoins #sellpi #Nigerian #tradepi #pinetworkcoins #sellmypi
how to swap pi coins to foreign currency withdrawable.DOT TECH
As of my last update, Pi is still in the testing phase and is not tradable on any exchanges.
However, Pi Network has announced plans to launch its Testnet and Mainnet in the future, which may include listing Pi on exchanges.
The current method for selling pi coins involves exchanging them with a pi vendor who purchases pi coins for investment reasons.
If you want to sell your pi coins, reach out to a pi vendor and sell them to anyone looking to sell pi coins from any country around the globe.
Below is the contact information for my personal pi vendor.
Telegram: @Pi_vendor_247
Introduction to Indian Financial System ()Avanish Goel
The financial system of a country is an important tool for economic development of the country, as it helps in creation of wealth by linking savings with investments.
It facilitates the flow of funds form the households (savers) to business firms (investors) to aid in wealth creation and development of both the parties
2. Control
• ‘In management accounting, control usually means
ensuring that activities planned and undertaken
lead to desired outcomes.’
3. BUDGETARY CONTROL
BCCC0008 : Advanced Management
Accounting
• Budgetary control is defined by the Institute of Cost
and Management Accountants (CIMA) as:
• "The establishment of budgets relating the
responsibilities of executives to the requirements of
a policy, and the continuous comparison of actual
with budgeted results, either to secure by
individual action the objective of that policy, or to
provide a basis for its revision".
4. • Budgetary Control is the process by which budgets
are prepared for the future period and are
compared with the actual performance for finding
out variances, if any.
• In other words, Budgetary Control is a process with
the help of which, managers set financial and
performance goals, compare the actual results with
the budgets, and adjust performance, as it is
needed.
BUDGETARY CONTROL ( Contd.)
5. Check yourself
• 1. budgets relating the responsibilities of executives
to the requirements of a policy, and the continuous
comparison of actual with …………………
• 2. Budgetary Control is a process with the help of
which, managers……………
• 3. budgets are prepared for the future period and are
compared with the actual performance for finding
out……….
6. • 1. budgeted results
• 2. set financial and performance goals
• 3. variances
7. Feedback and Feed-Forward Control
• Feedback and Feed-forward are two types of
control schemes for systems that react
automatically to changing environmental
dynamics.
8. Feedback Control
• ‘Measurement of differences between planned
outputs and actual outputs achieved, and the
modification of subsequent action and/or plans to
achieve future required results.
• Feedback control is an integral part of budgetary
control and standard costing systems.’
• Feedback as the name suggests is a reaction after an
action has taken place. So, there has to be an error if
we want to take corrective actions
• A feedback system would simply compare the actual
historical results with the budgeted results.
9. Limitations
• Feedback control system does have some
operational limitations.
• First, it depends heavily on success of the error
detection system.
• Second, there may be a time lag between the
error detection, error confirmation, and error
revision during which actual results may change
again
10. Feedforward control is defined as:
• ‘Forecasting of differences between actual and
planned outcomes, and the implementation of action,
before the event, to avoid such differences.’
• A feed-forward control system operates by comparing
budgeted results against a forecast. Control action is
triggered by differences between budgeted and
forecasted results.
• We may thus be able to place a control mechanism
before the error takes place. Feed-forward Control is
one such Controlling system
• Any manager who ignores feed-forward control will
contribute to the downfall of a company
11. Limitation
• The feed-forward process is an evaluation process
and is concerned with the estimates of uncertain
future. This problem of uncertainty is likely to
limit application of the concept.
• Study of future is not well developed; neither are
the tools that have potential for overcoming the
problem of uncertainty
12. Check yourself
1. What are the two types of control schemes for systems
that react automatically to changing environmental ?
2. differences between planned outputs and actual outputs
achieved in ………………… control
3. Forecasting of differences between actual and planned
outcomes in …………….. control
4. ……….control is an integral part of budgetary control
and standard costing systems
5. we want to take corrective actions in ……….
6. Any manager who ignores ………….control will
contribute to the downfall of a company
7. a ………………control mechanism before the error takes
place.
14. FLEXED BUDGETS
• Budget prepared to show the revenues, costs and
profits that should have been expected from the actual
level of production and sales.
• If the flexed budget is compared with the actual
results for a period, variances will be much more
meaningful.
• Flexible budget revised at actual activity level is
flexed budget.
• Flexed budget identifies the (variable, fixed, semi-
variable and step fixed) nature of costs with the change
in volume.
BCCC0008 : Advanced Management
Accounting
15. • Original budget is revised to reflect the effect of
variable elements, and step fixed costs at actual
output. After adjustment, the corresponding figures
are compared to calculate variances.
• The variance is not a result of change in output level
but result of change in expenditure level.
• However, please note that fixed costs remain
unchanged regardless of the level of activity and
should not be flexed
16. How to flex a budget?
• Consider this - you plan to make 10 products.
• Each product should use 2kg each.
• Therefore the budgeted number of kg is 20kg
• Actually 14 products were made and 25kg used.
• If the budget wasn't flexed you would compare 25kg to the
budgeted 20kg and get an adverse variance of 5kg.
• But this is not taking into account the fact that 4 more products
were made than budgeted
• So we need to flex this budget..
• Actual quantity of 14 should take 2kg each = 28kg
• Actual kg used 25kg
• Therefore, the usage variance is actually 3 kg FAVOURABLE
17. Check yourself
1. …………..Budget prepared to show the
revenues, costs and profits that should have been
expected from the actual level of production and
sales
2. flexed budget is compared with the
……….for a period
3. ………………revised at actual activity level is
flexed budget
4. The variance is not a result of change in output
level but result of change in……………..
19. TARGET SETTING AND
MOTIVATION
• Target-setting is a strategic process to establish
performance goals for energy, waste utilization and
management.
• Each topic uses a different tool that starts with
establishing a baseline: how much energy, water, or
waste is currently being used or generated.
• Setting target goals and action plans is a process. It
takes the efforts of teams to understand the baseline and
the vision and to determine the most effective set of
performance improvement measures (PIMs) for
achieving the target goals.
• It is an iterative process and requires measurement and
validation and a frequent reassessment of goals.
BCCC0008 : Advanced Management
Accounting
20. • Budgets can be used to affect employee attitudes and
performance.
• Budgets should be participative, including participation by
those to be affected by them. Further, lower - level
employees are on the operating line every day so they are
quite knowledgeable.
• Their input is needed. Budgets can be used to motivate
because participants will internalize the budget goals as their
own since they participated in their development.
Information should be interchanged among budget
participants.
• An imposed budget will have a negative effect on
motivation. Further, there is a correlation between task
difficulty and loss of control to negative attitudes.
21. Measuring Performance
• Performance measurement is the regular systematic
collection, analysis, and reporting of data that tracks
resources used, work produced, and whether specific
outcomes were achieved by an organization.
• Performance measurement is primarily a long-term strategic
thinking methodology while performance or outcome
budgeting is a year-to-year exercise for budget adjustment.
• It is necessary to understand the two concepts are separate
but inextricably linked.
• Performance/outcome based budgeting cannot be done
without a performance measurement system in place and
the strategic visioning inherent to performance
measurement.
22. Controllable and Un-controllable
outcome
• The main problem with measuring performance is in
deciding which costs are controllable and which costs are
traceable.
• The performance of a manager is indicated by the
controllable profit and the success of the division as a whole
is judged on the traceable profit.
• Controllable costs and revenues are those costs and
revenues which result from decisions within the authority of
a particular manager within the organisation.
• These should be used to assess the performance of the
managers.
• For example, depreciation on machinery in Division A is a
traceable fixed cost because profit centre managers do not
have control over the investment in non-current assets.
23. • Most variable costs are controllable in the short
term because managers can influence the efficiency
with which resources are used.
• Some costs are non-controllable, such as increases
in expenditure items due to inflation.
• Other costs are controllable in the long term rather
than the short term.
• For example, production costs might be lower by
the introduction of new machinery.
• However, its results will be seen in the long term.
24. 1 word Question
• …………is a strategic process to establish
performance goals for energy, waste utilization and
management.
• PIM full form ?
• An imposed budget will have a …….. effect on
motivation.
• The main problem with measuring performance is
in deciding which costs are ……… and which costs
are …………
26. Behavioural impact of Budgetary
control
• Behavioural aspects elucidate that many of the
goals of budgeting are contradictory.
• On the one side, we want to be able to fairly
evaluate the performance of managers.
• But we also want to motivate managers and
therefore, even if managers are not involved in the
process, managers may find the budget too
challenging and therefore reduce their effort.
• That in turn would distort any evaluation.
27. • Budgets have no motivational effect unless they are
accepted by the managers involved as their own
personal targets.
• Up to the point where the budget is no longer
accepted, the more demanding the target the better
the results achieved.
• Demanding budgets are seen as more relevant than
less difficult targets, but negative attitudes result if they
are seen as too difficult.
• Acceptance of budgets is facilitated when good upward
communication exists. The use of departmental
meeting was found helpful in encouraging managers to
accept budget targets .
• “Budget level that motivates the best level of
performance may not be achievable. In contrast, the
budget that is expected to be achieved motivates a
lower level of performance as managers no longer
aspire to meet the budget target.
28. Managers’ reactions to budget targets were found affected both
by their own personality and by more general cultural and
organizational norms.
The relationship between budget difficulty and the ensuring
level of performance can be shown graphically and is illustrated
as under:
29. • According to Hopwood
• Hopwood (1976) observed three distinct styles of using
budget and actual cost information in performance
evaluation in manufacturing division of a large US company:
30. Budget Constrained Style:
• The evaluation is based upon the Cost centre head’s
ability continually to meet the budget on short term
basis.
• managers are forced to limit their spending within the
ambit of the budget and would be punished when
budgets are overspent.
• This style of budgeting process has been criticised for
the possible occurrence of any of the following: low
morale of staff, increased job stress, manipulation
of accounting information just to meet with budget,
poor worker-manager relationship, etc.
31. Profit Conscious Style:
• Performance of the Cost Centre’s head is linked to
ability in increase the general effectiveness of his unit’s
operations in relation to the long- term goals of the
organisation.
• this is budgetary style where the focus is on whether
your actions and activities are geared towards long-
term profitability and overall improvement of the
business as whole.
• This style of budgeting avoids the drawbacks of the
constrained style of budgeting and gives a business
greater chance of ensuring that managers actions are
all targeting the overall goal of the company.
32. Non- Accounting Style:
• Accounting data plays a relatively unimportant part
in the supervisor’s evaluation of the cost centre
head’s performance.
• accounting and budgetary information plays little
role in performance evaluation.
• Other non financial factors are used to appraise
managers’ performance.
33. 1. Word Question
• 1. …………………… observed three distinct styles of
using budget and actual cost information
• 2. Behavioural aspects elucidate that many of the
goals of budgeting are…………
• 3. Acceptance of budgets is facilitated when good
…………communication exists.
• 4. managers are forced to limit their spending
within the ambit of the budget and would be
punished when budgets are overspent in
……………………………..style
34. • 5. ………budgetary style where the focus is on
whether your actions and activities are geared
towards long-term profitability and overall
improvement of the business as whole.
• 6. ………budgetary style, Accounting data plays a
relatively unimportant part in the supervisor’s
evaluation of the cost centre head’s performance.
• 7. ……………….. style of budgeting avoids the
drawbacks of the Budgets constrained style of
budgeting
36. Dysfunctional Behaviour:
• Dysfunctional behaviours in budgetary control
system are those suboptimal
decisions that managers make just to ensure that
they meet targets and get their bonus.
• The essence of budgeting which includes
motivation of managers will be defeated if
proactive action is not taken at both the design
stage and implementation stage of budgetary
control
37. • Some dysfunctional behaviours of a badly designed
budgetary control system
• 1. Budgetary slack and padding-situation where managers
either over budgets or under budgets
• 2. Gaming: managers focus on the easy measures and ignore
the ones that are perceived to be hard.
• 3. Management fraud: common example of this problem is
when managers prepare creative and fraudulent accounting.
• 4. Conflict: conflict arise when managers competes with
other managers in order to achieve their target without
minding what happens to the overall objectives of the
company
• 5. Short termism or myopia: this problem arises as a result of
the fact that managers only care about what yields immediate
result at the expense of longer term objective
38. Ethical consideration in Budgeting
• Ethical business budgeting steers clear of situations that
involve conflicts of interest that can lead to dishonest
accounting and improper allocation of resources.
• A manager who is also a stakeholder with a major vendor
may opt to skew the budgeting process to direct a
disproportionate share of the company's purchasing
revenue toward his own endeavour.
• Similarly, corporate officers who earn tremendous bonuses
based on company profits may prioritize profit over ethical
considerations.
• Ethical budgeting involves giving decision-making power
primarily to people whose financial priorities are honest and
clear.
39. • Budgeting is the process of allocating a company's
financial resources.
• Although practical necessity plays a vital role in this
process, spending decisions come down to priorities
and values, as well.
• A business that is clear about its ethical direction will
approach the budgeting process as a way to make
choices that help the company realize its vision and
• its goals in ways that are also financially sustainable,
balancing financial considerations with questions of
what makes business activities meaningful and
worthwhile.
Ethical consideration in Budgeting
40. • 1. …………..involves giving decision-making power
primarily to people whose financial priorities are
honest and clear.
• 2. Budgeting is the process of ………a company's
financial resources.
• 3. Budgetary slack and padding is a example of
…………… in budgetary control
• 4. Short termism or myopia is a example of
…………… in budgetary control
Though situation may demand that budgets be strictly adhered to but, care should be taken not to make it be counterproductive . It does not matter whether your action(s) will benefit the company in the long run.
If you can prove that your action will favour the company in the future, you will be rewarded rather than being punished.
Research and development team may be evaluated on the basis of the quality of research being carried out and the number of new discovery made and not the amount of profit made from the department.