International Journal of Research in Finance and Management
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E-ISSN: 2617-5762|P-ISSN: 2617-5754

2023, Vol. 6, Issue 2

The impact of budgetary control on organizational performance

Niraj Prasad, Mayank Bajpai and Audhesh Tripathi

Budget is an anchor of financial management in organization. The economic effect is performance, profitability and economic sustainability. This comprehensive review goes through at length the far-reaching impact of efficiency control on organizational performance, with current research utilized to report its advantages, disadvantages, and theoretical underpinnings. Notably, the secondary qualitative analysis identifies the fundamental concepts of flexible budgeting, zero-based budget model and standardization of business processes together. The study gives an understanding of the significance of the proper budgetary control for an organization to thrive and be financially stable. Flexible budgeting becomes an integral tool of budgetary control because it gives organizations power to amend their budget plans and financial plans when new circumstances emerge. By developing flexibility into the budgetary structure, organizations can align their resource allocation more closely with the priorities which are changing or the market dynamics, giving them the power to achieve their strategic goals even in the uncertain period.
Through the zero-based budgeting model, the organization gets an effective budgetary control tool with the main goal that all expenses should be justified from the very beginning or else they should get disapproval, unlike using historical data or making minor adjustments. This approach establishes the organizational culture of accountability and critical review, which leads assessing the organization’s input in accordance with the strategic objectives and potential effectiveness of the programs. The standardization of business practices turns into the major source of budgetary control effectiveness allowing the use of consistent, clear, and accurate financial management process. Organizations can make their operations more efficient by uniting uniform approaches for budgeting, monitoring, and reporting expenditures. Errors would be decreased and accountability enhanced. Through this process, this lays the foundation of their financial management skills.
Through a meticulous analysis of an impact of budgetary check and balancing systems, companies can enhance allocation of resources, decision- making processes and a culture of sound economics. Through this, we have revealed that the institutions need to evolve the budget control techniques as one of the ways of managing the complexities of the modern business world and gaining organizational development. Finally, good budgetary control is the foundation of good organizational performance, granting management a tool to once again finance its company properly and pursue its strategic goals with confidence.
Pages : 266-272 | 180 Views | 90 Downloads

International Journal of Research in Finance and Management
How to cite this article:
Niraj Prasad, Mayank Bajpai, Audhesh Tripathi. The impact of budgetary control on organizational performance. Int J Res Finance Manage 2023;6(2):266-272. DOI: 10.33545/26175754.2023.v6.i2c.333
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