Write a short note on budgetary control as a technique of managerial control.
Budgetary control is a technique of managerial control in which all operations are planned in advance in the form of budgets and actual results are compared with budgetary standards. This comparison reveals the necessary actions to be taken so that organisational objectives are accomplished.
A budget is a quantitative statement foe a definite future period of time for the purpose of obtaining a given objective. It is a statement which reflects the policy of that particular period. It will contain figures of forecasts both in terms of time and quantities. However, the effectiveness of budgeting depends on how accurately estimates have been made about future. Flexible budgets should be prepared which can be adopted if forecasts about future turn out to be different, especially in the face of changing environmental forces. Managers must remember that budgeting should not be viewed as an end but a means to achieve organisational objectives.
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