Report on Budget Preparation Process for Economic Analysis

This report outlines the process of budget preparation, crucial for financial planning and economic analysis. It begins by emphasizing the importance of a disciplined approach and a set schedule for budget creation. The report then details the steps involved: revising budget assumptions, evaluating bottlenecks, assessing available financing, identifying step costing points, creating budget packages, issuing budget packages, obtaining revenue projections, utilizing revenue information, preparing departmental budgets, requesting capital budgets, updating the budgeting model, reviewing the budget with senior management, tracking budget change requests, creating a final budget version, and loading the budget into financial software. These steps ensure a comprehensive and effective budgeting process, allowing for accurate financial forecasting and control. The report also includes references to relevant academic papers and resources.

Running head: QUESTION 1
ENGINEERING ECONOMIC ANALYSIS
Student details:
6/8/2019

QUESTION 2
Various companies make budgets, which they use as the process of comparison while assessing
the actual outcomes over the upcoming period. The procedure of making the budget must be
greatly disciplined as well as adopt the set schedule, so that the accomplished budget is prepared
for utilize through the starting of the subsequent fiscal year (Ingga, 2016). Following are the
steps of preparing the budget-
1. Revise the assumption related budget- the first step is to review the assumption in relation
to business atmosphere of organization, which were utilized as basis for previous budget,
as well as revise according to the requirement.ng
2. Evaluate bottlenecks- measure the level of capacity of primary bottleneck, which is
restraining the organization from producing more sales, and describe how it will
influence the extra revenue growth of company.
3. Accessible financing- assesses the finance amount, which would be available at the time
of budget period that can restrict the development plan.
4. Step costing point- assess whether the step costs would be occurred during a probable
range of actions related to business in a future budget period.
5. Make budget packages- Copy forward fundamental budgeting instruction from
instructions packet utilized within last year. Further upgrade this by involving year-to-
date real expenditures occurred in present year, and also annualizes the data for whole
present year. Add a explanation for a packet (Arthur, 2016).
6. Issue budget package- individually issue budget package, wherever probable, and reply
the queries from the recipient.

QUESTION 3
7. Get projection related to revenue- get the projection related to revenue from the sale
manager, assess this with chief executive officer, and allocate this to department
managers.
8. Use the revenue information- get data as foundation for establishing personal budgets.
9. Get departmental budget- get budget from all sections, check for mistakes, and compare
bottleneck, financing, as well as step costing constraint.
10. Get request related to capital budget- authenticate the request related to capital
budget and send them to a senior manager for review.
11. Updating budgeting model- input all budget information into the master budget model.
12. Reviewing- Meet with senior manager for reviewing budget.
13. Trace budgeting request- trace exceptional requests related to budget changes.
14. Make bound version of budget- make restrict description of the budget and allocate this
to all authorized recipient.
15. Loading budget- Load data related to budget in the financial software (Erlina and Muda,
2017).

QUESTION 4
References
Arthur, F.E. (2016) Budgeting in Budget Management Centres (BMCs) in Sekondi/Takoradi
Metro Health Directorate. Journal of Social Science for Policy Implications, 4(1), pp.63-90.
Erlina, A.S. and Muda, I. (2017) Antecedents of Budget Quality Empirical Evidence from
Provincial Government In Indonesia. International Journal of Economic Research, 14(12),
pp.301-312.
Ingga, I. (2016) The Influence of Budget Participation and Participation in Budget Control on
Managerial Performance. International Business Management, 10(19), pp.4699-4702.