Audit Manual - Core Treasury System Uttarakhand

Government of Uttarakhand
Audit Manual
1. Budgeting
1.1 Introduction
Budgetary control is defined by The Chartered Institute of Management Accountants (CIMA) as:
The establishment of budgets relating the responsibilities of executives to the requirements of a policy, and the continuous comparison of actual
results with budgeted results, either to secure by individual action the objective of that policy, or to provide a basis for its revision. Budget is a
formal statement of the financial resources set aside for executing specific activities in a given period of time. It helps to coordinate the activities
of the organization.
A good budget is characterized by the following:
• Participation: Involve as many people as possible in drawing up a budget
• Comprehensiveness: Embrace the whole organization
• Standards: Base it on established standards of performance
• Flexibility: Consider changing circumstances
• Feedback: Constantly monitor performance
• Analysis of costs and revenues: This can be done on the basis of product lines, sections or cost centers
The budgetary process is a significant tool of financial control vested with the government. The budget exercise incorporates the entire gamut of
plan and non-plan activities during the budget year. The importance of budgetary controls has increased in the present context with regard to
establishing effective cost control mechanism in the entire spectrum of activities undertaken by various government departments.
Note:
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