Following are the important aims or purposes of budgeting:
1.Planning for Future by keeping in view of business plans and objectives.
2.For forecasting future incomes, expenses and profitability.
3.Communicating managers their targets for upcoming year.
4.For controlling spending and ensuring spending matches with priorities.
5.Used as a performance evaluation tool by evaluating performance of managers.
6.Used to motivate managers by giving them targets/budgets. Bonuses are given to them on achieving targets.
NEXT→ BUDGET PREPARATION AND STAGES IN BUDGET PREPARATION
