Budgetary and Non-Budgetary

Control Techniques
BY: CHRISTINE L. SABANGAN, CPA
 BUDGET AND BUDGETARY CONTROL
BUDGET- is a pre-determined statement of management policy which
provides a standard for comparison with actual results during a given period.

BUDGETARY CONTROL- is basically a technique where the actual results

i.e. actual revenues and expenses are compared with the budget planned
before the start of the financial year.

This Photo by Unknown Author is licensed under CC BY

 BUDGETARY CONTROL TECHNIQUES

1. RESPONSIBILITY ACCOUNTING
- classified as COST, PROFIT, and INVESTMENT center.
- based on this classification employee will be assigned with a target
- on the basis of achievement he/she will be rewarded.

2. VARIANCE ANALYSIS
- estimated budget of the organization will be compared with actual
accounting figures to measure the variance
 BUDGETARY CONTROL
TECHNIQUES
3. FUND ADJUSTMENT
- Top management will be altering the fund allocation based on the
requirement.

4. ZERO-BASED BUDGETING
- Next year budget is made on nil base
NON-BUDGETARY CONTROL
TECHNIQUES
- Control over the organization other than the financial resources
- Classified into:
Traditional Techniques
Modern Techniques
TRADITIONAL TECHNIQUES
a. STATISTICAL DATA

b. PERSONAL OBSERVATION
TRADITIONAL TECHNIQUES
c. OPERATIONAL AUDIT
- is the regular and independent appraisal, by a staff of internal auditors, of the accounting,
financial, and other operations of a business

d. BREAK-EVEN POINT ANALYSIS

- A technique for identifying the point
at which total revenue is just sufficient to
cover total costs
MODERN TECHNIQUES
a. PERT
-flowchart diagram that depicts the sequence of activities
needed to complete a project and the time or costs associated
with each activity.

b. GANTT CHART
- A scheduling chart that shows actual and planned output over a period of time