A budget is a financial document used to project future income and expenses. The budgeting process may be carried out by individuals or by companies to estimate whether the person/company can continue to operate with its projected income and expenses To run a home with four or five people, with a limited income, we need to plan and budget. Just think about a nation, its people vast and never ending needs. Without a budget we hardly know where we will go and land. When we budget, we know where we need to spend the money, and how much what the priorities are. Without budget you never know how much you need to spend and in what areas.
There are definitely many uses of the budgeting exercise. First, it helps us to have a look at the needs of the country, what are our basic needs how much do we need and to what time to do what? All these details we come to know only when we budget . Budgeting for infrastructural development, completion of projects. On top of it resources and funds should be set set aside for the development of research and most important of all, for the security and safety of the nation, funds should be allotted to the defense. Funds should be set aside for subsidies, natural calamities. And the list goes on and on. It is just impossible to run a country and to take it on a progressive way, if there is no budgeting. You don’t know the priorities, when you don’t budget, you don’t know where you need to spend the money. You never know if you will be spending money on unnecessary, matters. So the uses of budgeting are limitless, and the truth is that budgeting is a need, not an option that we have, to see if we have any uses we will budget or otherwise no. budgeting exercise useful to raise GDP of our country,
Budget is prepared to future growth and reduce the expenses. So the overall budget decided growth of India. But the fund has not properly utilized in Indian country, all benefits are not properly reached by people, so there is no growth in our country. Corruption is main reason, the government and people has to follow the rules and regulation strictly then only we can avoid the corruption. Budgeting is really important and is of great use at any social or individual level. In any economy, the government receives huge funds through different taxes, duties, customer, etc. And, to ensure that these funds are invested correctly and proportionally as per the requirement, having a budget becomes imperative.
It helps in overcoming a financial problem strategically. And, for a country, it ensures that sectors which need special financing are given due importance. Some might say that budgeting takes a lot of time which makes the process lengthy and time consuming. However, it is necessary that we ensure that funds are utilized most efficiently because while making a budget for a nation a lot of facts and figures needs to be taken into consideration. For example, which sector needs urgent and immediate finance. There might be sectors which received extra funds last time that are yet to be used. Hence, such sectors would need less funds this time. Budget also helps government to properly distribute the funds in an economy. So that, the gap between the rich and the poor in a country can be bridged. Budget also affects the market decisions.
Without budget, the funds may go wasted and not utilized properly. In a vast & democratic country like India for proper usage of public money we must have proper planning. But preparation of this layout model of budgeting takes so much time & more than that time is wasted in implementing that plan. In this way around 8 months of a year is completed. Proper benefit of budget people gets for 3 to 4 months. Proper vigilant system must be implemented to put a close eye on the system to check whether plans are getting implemented or not. Most importantly our bureaucrats & politicians should stop encouraging corruption so that public money could be utilized for the public welfare. Most of the people associated the word budget with the Union Budget.
The budgeting starts at individual level. As every mother or leader of the family allocates a specific percentage or amount of resources to different needs based on the requirements of the family members taking into account the uncertainties and price rises and change in preferences is one of the apt epitomes of budgeting. Budgeting is a very useful exercise. It is an exercise where a person puts the economic problem into action. Problem of choice, scarcity of resources, hierarchy of wants, multiple uses of resources, problem of abundance , allocation of funds and optimum utilization of resources. If a person doesn’t earn or pay directly he may not understand the value of resources but as a person continually prepares budgets the price factor also fits into the linear programming problem of maximizing satisfaction by maximizing quality an apply to groups that have underspent their budgets to date.
Budgetary exercises typically include restrictions on new hiring. These can be either across-the board reductions in the number of new heads that each department can add for the remainder of the year.In some companies, budget exercises are habitually predictable annual events, sometimes in the summer, sometimes in the fall, and sometimes in both time frames. In companies that habitually run one or more budgetary exercises annually should note that their jobs can be especially stressful on an ongoing basis.
Budgetary exercises typically include restrictions on new hiring. These can be either across-the board reductions in the number of new heads that each department can add for the rremainder of the year, or a complete hiring freeze.
In addition to expense cuts, budget exercises also can involve reductions to capital budgets
In some companies, budget exercises are highly predictable annual events, sometimes in the summer, sometimes in the fall, and sometimes in both time frames.In companies that habitually run one or more budgetary exercises annually should note that their jobs can be especially stressful on an ongoing basis.