The document outlines financial control as a means for organizations to monitor their financial resources through various methods like accounting standards and audits. It details budgeting control as a system for managing costs by preparing budgets and comparing actual performance to set targets, highlighting the benefits of effective budgeting in resource allocation. Additionally, it explains cost control as a practice aimed at reducing business expenses, emphasizing its importance for enhancing profit-making capacity and operational efficiency.

1. MANAGEMENT THEORY
GROUP XI

3. FINANCIAL CONTROL
• Financial controls are the procedures, policies,
and means by which an
organization. monitors and controls the
direction, allocation, and usage of its
financial resources.

4. 11 Examples of Financial Control
• 1) Accounting standard
• 2) Financial Statement
• 3) Operating Metrics
• 4) Policies
• 5) Segregation of Duties
• 6) Reconciliation
• 7) Responsibilities
• 8) Approvals
• 9) Disbursement Policies
• 10) Audit Trail
• 11) Information Security

5. BUDGETING CONTROL
• Budgetary Control can be defined as a system
of controlling costs which includes the
preparation of budgets, coordinating the
department and establishing responsibilities,
comprising actual performance with the
budgeted and acting upon results to achieve
maximum profitability.

6. TYPES OF BUDGETING CONTROL
• FINANCIAL BUDGET
-cash budget
-capital expenditures
-balance sheet budget
• OPERATING BUDGET
-sales or revenue budget
-expense budget
-project budget
• NON-MONETARY BUDGET
-fixed costs
-variable cost
-semi variable costs

7. BENEFITS OF BUDGETARY
CONTROL
• Budgeting plays an important role in planning
and controlling. It helps in directing the scarce
resources to the most productive use and thus
ensures overall efficiency in the organization.

8. WHAT IS COST CONTROL?
• Cost control is the practice of
identifying and reducing business
expenses to increase profit and its start
with the budgeting process.

9. • FORMULA FOR NET INCOME
• Sales – Fixed Costs – Variable Cost = Target Net
Income

11. • Inventory – is a variable cost that can be
reduced by finding other suppliers that may
offer more competitive prices.

12. • WHY COST CONTROL IS NECESSARY?
• 1.
Profit making capacity of a business Efficiency with which
various cost are controlled increase
the efficiency in use of materials Machinery Labour