How Reports Help with Basic Budgeting
IN THIS CHAPTER
Examining the budgeting process
Figuring out how budgets are created
Understanding the importance of monthly budget reports
Putting internal budget reports to work
No matter how good the numbers look, you don't know how well a company is really doing until you compare the actual numbers with the company's expectations. Expectations (the budget targets a company hopes to meet) are spelled out during the budgeting process, in which the company projects its financial needs for the next year. At different times throughout the year, managers use these budgets, along with periodic financial reports, to determine how close the company is to meeting its budget targets.
As an outsider, you don't have access to the company's budgets or the reports related to them. But if you're seeking to find out more about internal financial reports and how to use them effectively, understanding the budgeting process is critical.
This chapter discusses the budgeting process and how it complements financial reporting. A well-planned budgeting ...