Financial Planning, Budgeting, and Forecasting: Financial Intelligence Collection (7 Books)

Approaches to Preparing a Budget

HOW DO YOU APPROACH preparing budgets needed for your part of the organization? You have several options at your disposal. Below, we examine a few different approaches.

Traditional budgeting

Many organizations use a “traditional” budget—a budget that covers a one-year period and that presents forecasts that do not change during the life of the budget cycle. Companies use traditional budgets because they are easy to put together and they simplify coordination of budget assumptions across different departments.

Traditional budgets, however, have been under growing attack from those who feel that they no longer serve ...