The implementation of budget is the responsibility of the budget director. The success of the entire exercise of budgeting depends on two important factors.
First, proper and clear communication to all key people involved in the implementation of the budget. They should clearly know what is expected of them and how to achieve the goals.
Second, the co-operation and encouragement by the top management in achieving the targets as identified in the budgets. The top management should be willing to reward people who meet budget goals.
Ideally, top management and the lower level of management should work together to prepare and implement the budget successfully.
Budgeted statement of cash receipts and cash disbursements for the XYZ Company for the year ended 30th June 20×1.
|Total||First Quarter||Second Quarter||Third Quarter||Fourth Quarter|
|Opening cash balance||85,000||20,000||15,000||30,000||20,000|
|Total Cash Available||1,45,000||35,000||21,000||56,000||33,000|
|Minimum Cash Balance Required||20,000||5,000||5,000||5,000||5,000|
|Total Cash Needed||1,20,000||45,000||31,000||21,500||22,500|
|Excess of Cash available over Cash Disbursements||25,000||(10,000)||(10,000)||34,500||10,500|
|Budgeted Balance Sheet, 30th June 20×1|
|Liabilities and owner’s equity|
|Reserves and Surplus||20,000|