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The Recording Of Budget Items
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To coordinate budgets within any organisation, managers should use a standard budgeting format. This will help with teamwork over budget content and enable budgets to be compared and linked throughout the organisation. When an organisation uses a standardised format for their budgeting, past budgets for the department may be used to ensure correct completion.
The preparation of identical reports in the same format from one time to the next helps the reader to identify important facts or information. Standardising the report format also helps the reader to compare the information contained in one report with related information contained in others.
If you are new to the budgeting task, it is always a good idea to pull copies of previous budgets and accounting reports and compare the budgeted numbers to actual numbers. If no historical information is available, find other sources of information that can help guide the development of figures for your budget.
Check your draft budget and see whether it makes sense to you. Are you missing any anticipated sources of revenue or expenses? Are the numbers realistic? Do they make sense when you compare them to any historical budgets that you have sourced? Most importantly, will you be able to support your figures when you present your budget to senior management?