10 essential requirement of budgetary control.

Budgetary control is the establishment of budgets relating the responsibilities of executives to the requirement of a policy and the continuous
comparison of the the actual with budgeted results either to secure by individual action the objectives of that policy or to provide a basis of its revision. 

The following are essential requirement of budgetary control:

  • Budget must have the complete cooperation of chief executive.
  • The budget must be realistic and the goals attainable.
  • The ultimate realization of the maximum amount of profit should always be kept uppermost.
  • Responsibility for the preparation of the estimates should rest on those individual responsible for performance.
  • A budget committee should be established consisting of the budget director, the chief executive officer and the executives of various division of the organization.
  • The budget should cover all phases of operation.
  • Budgeting should be continuous.
  • Periodic reports should be prepared promptly, comparing the budget and the actual results.
  • The accounting system should be adequate.
  • A good organization must be developed. 

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