Week 2 - Budgets: Behavioural and Social Aspects Flashcards
1
Q
What is a budget?
A
2
Q
What are the roles of budgets?
A
- planning
- co-ordination
- communication
- authority
- sense making
- control
- motivation
- performance evaluation
3
Q
what is budgetary slack?
A
Its a cushion created in a budget by management tom increase the chances of actual performance beating the budget. Budgetary slack can take one of two forms: an underestimate of the amount of income or revenue that will come in over a given amount of time, or am overestimate of the expenses that are to be paid over the same time period.
budgets contain slack if the business unit’s manager have intentionally set their targets lower than their best guess forecast about the future so that the budget becomes easier to achieve
4
Q
what is budgetary control?
A
