Fiel Angelo G.

Mallari, RN
 the process of creating a plan to spend your
money
 a proactive approach – rather than a reactive
approach – to manage your money
 the setting of expenditure levels for each of
an organization’s functions.
 the estimation and allocation of available
capital used to achieve the designated
targets of an organization.
 making sure that you’re spending less than
you’re earning and planning for both the
short and long term.
 making intentional choices about what
happens with your money in an effort to live
a better life instead of just buying whatever,
whenever and hoping for the best.
 allows you to determine in advance whether
you will have enough money to do the things
you need to do or would like to do.
 help people save for retirement, emergencies,
a new car, college tuition or just about
anything.
 allows you to make financial decisions ahead
of time, which makes it easier to cover all
your expenses throughout the year
 determine how and where you want to spend
your money.
 track your spending and determine if it is
matching your priorities
 allows you to monitor your progress on goals
and make sure you are sticking to your
financial plan.
ZERO-BASE BUDGETING
 A zero-base budget involves determining what
outcomes management wants, and developing a
package of expenditures that will support each
outcome. By combining the various outcome-
expenditure packages, a budget is derived that
should result in a specific set of outcomes for
the entire business. This approach is most useful
in service-level entities, such as governments,
where the provision of services is paramount.
However, it also takes a considerable amount of
time to develop, in comparison to the static
budget.
FLEXIBLE BUDGETING
 A flexible budget model allows you to enter
different sales levels in the model, which
will then adjust planned expense levels to
match the sales levels that have been
entered. This approach is useful when sales
levels are difficult to estimate, and a
significant proportion of expenses vary with
sales. This type of model is more difficult to
prepare than a static budget model, but
tends to yield a budget that is reasonably
comparable to actual results.
INCREMENTAL BUDGETING
 Incremental budgeting is an easy way to
update a budget model, since it assumes that
what has happened in the past can be rolled
forward into the future. Though this
approach results in simplified budget
updates, it does not provoke a detailed
examination of company efficiencies and
expenditures, and so does not assist in the
creation of a lean and efficient enterprise.
STATIC BUDGETING
 This is the classic form of budgeting, where a
business creates a model of its expected results
and financial position for the next year, and then
attempts to force actual results during that
period to align with the budget model as closely
as possible. This budget format is typically based
on a single expected outcome, which can be
extremely difficult to achieve. It also tends to
introduce a great deal of rigidity into an
organization, rather than allowing it to react
quickly to ongoing changes in its environment.
MASTER BUDGET
 A master budget is an aggregate of a
company's individual budgets designed to
present a complete picture of its financial
activity and health. The master budget
combines factors like sales, operating
expenses, assets, and income streams to
allow companies to establish goals and
evaluate their overall performance, as well
as that of individual cost centers within the
organization. Master budgets are often used
in larger companies to keep all individual
managers aligned.
OPERATING BUDGET
 An operating budget is a forecast and
analysis of projected income and expenses
over the course of a specified time period. To
create an accurate picture, operating
budgets must account for factors such as
sales, production, labor costs, materials
costs, overhead, manufacturing costs, and
administrative expenses. Operating budgets
are generally created on a weekly, monthly,
or yearly basis. A manager might compare
these reports month after month to see if a
company is overspending on supplies.
CASH FLOW BUDGET
 A cash flow budget is a means of projecting how and
when cash comes in and flows out of a business
within a specified time period. It can be useful in
helping a company determine whether it's managing
its cash wisely. Cash flow budgets consider factors
such as accounts payable and accounts receivable to
assess whether a company has ample cash on hand to
continue operating, the extent to which it is using its
cash productively, and its likelihood of generating
cash in the near future. A construction company, for
example, might use its cash flow budget to
determine whether it can start a new building
project before getting paid for the work it has in
progress.
FINANCIAL BUDGET
 A financial budget presents a company's
strategy for managing its assets, cash flow,
income, and expenses. A financial budget is
used to establish a picture of a company's
financial health and present a comprehensive
overview of its spending relative to revenues
from core operations. A software company,
for instance, might use its financial budget
to determine its value in the context of a
public stock offering or merger.
STATIC BUDGET
 A static budget is a fixed budget that remains
unaltered regardless of changes in factors
such as sales volume or revenue. A plumbing
supply company, for example, might have a
static budget in place each year for
warehousing and storage, regardless of how
much inventory it moves in and out due to
increased or decreased sales.
ROLLING BUDGET
 A rolling budget requires that a new budget
period be added as soon as the most recent
period has been completed. By doing so, the
budget always extends a uniform distance
into the future. However, it also requires a
considerable amount of budgeting work in
every accounting period to formulate the
next incremental update.
ENVELOPE BUDGET
 An envelope budget is a budget where you assign
money to each category and deal with cash for
several of your expenses.
50/30/20 Budget
 The 50/30/20 budget helps you determine how
much you should be spending on different
categories.
50% needs
30% wants
20% savings
5-Category Budget
The 5-Category budget sets up five basic
categories and determines the percentage that you
should spend on each
Housing 35%
Transportation 15%
Living expenses 25%
Savings 10%
Debt 15%
ZERO BASED BUDGET
 A zero-based budget is when you plan how you
are going to spend your income down to the last
penny.
 refers to the process by which governments
create and approve a budget
 this involves four major steps namely:

Budget Preparation
Budget legislation
Budget execution
Budget Accountability
 Budget Preparation involves the formulation
of estimates of revenues and expenditures by
the Executive Departments and Agencies. In
preparing the annual budget proposal, the
said department makes an estimation of
government revenues. It then determines the
budget priorities within available revenues
and borrowing limits. Finally, it translates
these approved priorities into expenditures.
 In the preparation of the budget, the DBCC
approves the parameters, makes a budget
call, conducts budget hearings, makes a
budget review then consolidates the budget.
It then validates and confirms the budget,
which is finally approved by the President of
the Philippines and his Cabinet. The
President thereby submits the budget to
Congress for approval.
 This pertains to the whole range of legislative action
on the budget, leading to the enactment of a General
Appropriations Law for the year. The Philippine House
of Representatives first conducts hearings/debates on
the budget.
 The House then approves the budget, for submission
to the Senate of the Philippines. Senate hearings and
debates are conducted on the budget, which is finally
approved. A Bicameral Conference Committee
composed of representatives of the Philippine House
of Representatives and the Senate is convened. After
approval by the Bicameral Conference Committee,
the President enacts the budget which is known as
the General Appropriations Act.
 Budget execution covers the allotment of
appropriations by the central budget
authority to, and the incurrence of
obligations by, the spending departments and
agencies of government. The steps in the
execution of the budget are:
a. Release of the funds by the Department of
Budget and Management (DBM)
b. Implementation of the various programs and
activities by the different government agencies
 This involved the reporting of actual
performance against plans or targets, and it
involves the following process:
a. Monitoring of agency budgetary performance
b. Comparison and evaluation of actual
performance with the initially-approved work
targets
c. A summary list of checks issued is submitted on
a monthly basis
d. Physical & Financial Report of Operations is
submitted on a quarterly basis in the form of a
trial balance