Finance for Nonfinancial Managers, Second Edition (Briefcase Books Series), 2nd Edition

The Annual Budget: Financing Your Plans

Once management has decided on a business plan that sets company goals for the next year, they need to determine (a) if they can afford to achieve those goals, (b) if the plan will make a profit for the company, and (c) if the plan will meet the goals set by management. Those questions are best answered by converting the operating plan’s goals and actions into dollars and cents, then breaking down the plans into chunks that can be evaluated and managed during daily operations. That’s the purpose of the annual budget. The annual budget is the estimate of the financial resources that will be needed and the ...