BUDGETING AS A BASIC FINANCIAL PLANNING

Abstract

Based on the strategic objectives of the enterprise, has been determined relevance of budgeting and has been identified as essential to the effective development of operation activities. It`s proven, that budgeting – the process of organization the financial and economic management of economic entities, which based on the development of budget for responsibility centers and activities, monitoring of their implementation, analysis of budget anomalies and regulation of economic activity to harmonize and achieve results at all management levels. The rationale for the role of budgeting in financial planning is treated differently by scientists: establishment budget milestones without assigning lead; formation of the financial structure of an instrument of financial planning and controlling; that the budget is a management technology. It has been determined that budgeting, as a management technology, should include three interrelated constituent parts: technology (targets and standards, budget types, budget consolidation schemes, formats), organization (liability centers, budgeting and budgetary control regulations, distribution of roles and responsibilities between different management levels, slotting systems) and automation of financial calculation. Main causes of necessity for implementation budgeting in domestic enterprises are: lack of information on real costs, expenses and income in the enterprises; misuse of organization resources; significant financial loss; foreclosure crisis. Scientifically based budgeting principles established the practical application of which is a prerequisite for effective budgetary planning. The role of budgeting in financial planning was justified as well as its benefits for domestics’ enterprises. A number of problems need to be solved to realize of benefits of enterprises budgeting, namely: economic, technical, organization, social and information.