Objectives of Budgetary Control

Objectives of Budgetary Control

Briefly, the main objectives of budgetary control are:

1. To combine the ideas of all levels of management in the preparation of  the budget.
2. To coordinate all the activities of the business.
3. To centralize control.
4. To decentralize responsibility to each manager involved.
5. To act as a guide for management decision-making when unforeseeable conditions affect the business.
6. To plan and control income and expenditure so that maximum profitability is achieved.
7. To direct capital expenditure in the most profitable direction.
8. To ensure that sufficient working capital is available for the efficient operation of the business.
9. To provide a yardstick against which results can be compared.

10. To show management where action is needed to remedy a situation.