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2010799205 Amin Noer Ariffudin B. Kamal Zaid 2010734609 Mohd Fakrul Azwan B.

Jaaffar 2010303497 Mohd Nazrin B Hamid


A budget is a financial plan. It is a projection (forecast)

of what will happen financially if certain strategies and decisions are implemented. For example, if you plan to buy a new car with a bank loan, you will want to know how much the loan repayment instalments will be. This helps you to construct a financial plan which includes determining the extent of the loan that you can afford. This type of planning is very much a budgeting activity.

A government budget is a legal document that is often

passed by the legislature, and approved by the chiefexecutive president. For example, only certain types of revenue may be imposed and collected.Property tax is frequently the basis for municipal and country revenues, while sales tax and/or income tax are the basis for state revenues, and income tax and corporate tax are the basis for national revenues

The two basic elements of any budget are the revenues an

expenses. In the case of the government, revenues are derived primarily from taxes . Government expenses include spending on current goods and services, which economists call government consumption; government investment expenditures such as infrastructure investment or research expenditure; and transfer payment like unemployment or retirement benefits. Budgets have an economic, political and technical basis. Unlike a pure economic budget, they are not entirely designed to allocate scarce resources for the best economic use. They also have a political basis wherein different interests push and pull in an attempt to obtain benefits and avoid burdens. The technical element is the forecast of the likely levels of revenues and expenses. National Budget - this is when a country finds out what the government's expected income and expenditure will be for that year

Budget is a financial plan of intended revenues and

expenditure of the government Provide a forecast of revenues and expenditures i.e. construct a model of how the government might perform financially and carried out the programs and activities. Enable the actual financial operation of the government stated in a monetary terms. is a legal document that is often passed by the legislature, and approved by the chief executive -or president.

1.Allocation of resources

2.Redistributive activities
3.Economic stability 4.Management of public enterprises:

Deficit budget - spending exceed income or

revenue. Surplus budget - Income exceed expenditure. Balanced budget - income and spending are equal.

As a Policy Statement

As a Financial Planning
As a Controlling Document As a tool for Performance Measurement

As a statement of Government business

transaction. The components of budget structure for Revenue Estimate

4 stages in preparing budget:

a. Preparation Stage.
b. Approval Stage. c. Execution/ Implementation Stage.

d. Auditing Stage.

Revenue Estimation performed in the executive branch

by the finance director, clerk's office, budget director, manager, or a team. Budget Call issued to outline the presentation form, recommend certain goals. Budget Formulation reflecting on the past, set goals for the future and reconcile the difference. Budget Hearings can include departments, sections, the executive, and the public to discuss changes in the budget. Budget Adoption final approval by the legislative body. Budget Execution amending the budget as the fiscal year progresses.

1. To plan and control the revenues and

expenditures of the government. 2. To control inflation and recession. 3. To develop the economy of the country. 4. To develop the human resource of the country. 5. To create a balance and progressive society

A good budget. Is the financial plan of the government- timely and accurately. Specific purpose- has clear defined objectives and action plans. Has time frame or time limit @ limited time period. Has estimate expenditures and revenues of a certain project or programme.