ABSTRACT

The question of the responsibility for the preparation of budgets has been the subject of a large amount of theorising. Experience has shown the necessity for the compilation of the budgets to be in the hands of those responsible in the business for the various functions to which budgeting is applied. In the exchange of experiences on budgetary control, the effect of the accuracy of the sales budget upon the other budgets is very apparent. The greatest effect of sales budgets has been to make the sales personnel "profit conscious". One important side-line which has developed out of the use of budgetary control, and the necessity for accurate sales and purchases budgets, has been the demand for external statistical and economic information. In some of the basic industries where production only follows the receipt of actual orders, past experience must, of necessity, be the influencing factor in preparing production budget.