Project budgets and reporting systems, Financial Management

Project Budgets and Reporting Systems:

In many cases, where a project is initiated and a budget allocated, a separate account is created to ensure costs attributable to that project are readily identified.  If a separate account was not commenced, expenditure would be spread across the general business accounts and an accurate breakdown of costs would be difficult to assess. The separate project account would include sub-accounts for areas of expenditure identified in the project budget.

Along with aligning budget items to accounts, once a budget is agreed and communicated to the staff who will manage them, a reporting system will need to be introduced to ensure budget information is relayed back to management.

Reporting systems of one form or another exist in most businesses, they can be as informal as a weekly meeting, or as formal as daily written reporting. Generally they reflect the personality of the business and the industry in which the business operates.

As a general guide however, for a reporting system to be effective it must:

  • Be unambiguous and clearly understood by all involved in the reporting chain
  • Provide for the establishment and delegation of clear lines of authority in the chain, such as who is authorised to adjust budgets and by how much
  • Detail what information needs to be collected and by whom
  • Detail how often this process is to occur
  • Detail how results are to be measured and interpreted and in what form are variances recorded
  • Detail how results are to be communicated once variances are reported and corrective courses of action taken
  • Advise on reporting action to management
Posted Date: 10/1/2012 4:21:58 AM | Location : United States







Related Discussions:- Project budgets and reporting systems, Assignment Help, Ask Question on Project budgets and reporting systems, Get Answer, Expert's Help, Project budgets and reporting systems Discussions

Write discussion on Project budgets and reporting systems
Your posts are moderated
Related Questions
What are the three major sections of the statement of cash flows? Cash flows from financing activities Cash flows from investing activities Cash flows from Operations

Discuss the risk associated with Foreign Direct Investment. How do these risks differ from those encountered in domestic investment.

Ask ques1. How would you judge the potential profit of Bajaj Electronics on the first year of sales to Booth Plastics and give your views to increase the profit? 2. Suggestion rega

Suppose you are a euro-based investor who simply sold Microsoft shares which you had bought six months ago. You had invested 10,000 euros to buy Microsoft shares for $120 each shar

#question.After read all the available information carefully, prepare a two page (double-spaced) essay and answer the following questions: Assume that we have the following data: C

It is a bond that does not give periodic interest payments. In spite of that, interest is added to the principal balance of the bond and is either paid at maturity or, at some poin

nd held it until it matured, what annual rate of return would she have earned? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16

a) Talk about in brief the various GAAPs that are mandatory to be followed. b) What are the several components of total cost.

Q. Miller Approach of irrelevance of dividends? Discuss the Modigliani as well as Miller Approach of irrelevance of dividends. What are its drawbacks? Ans. Modigliani with M

Describe the duties of the financial manager in a business firm? Financial managers evaluate the firm's performance, determine what are the financial consequence will be if the