FIN 305 Lecture 12: FIN305 25A
29 Nov 2016
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Document Summary
It"s hard to establish a feasible goal- you need to consider the process of creating a goal, who should be involved, iterations. Purpose: to help mgt achieve goals via tools, procedures, etc. and applying best practices to developing assumptions and benchmarks, forecasting financial results of operations, spending, cashflow, obtaining commitment of resources to accomplish, then use it to guide, monitor, control. Dev"t, organized, and committed to by managers of responsibility centres. Approved commitment of resources (by execs, essential to managers because they need to accomplish goals with it) Like a negotiated document- commit to goals, resources promised. 3 components of a master budget: operating budget, capital budget, cash budget. Investing activities and possible sources of financing for assets/resources to achieve goals. Consolidates cash impact of o and c budgets. Short term (1yr) but into intervals based on operating cycle (wk/mo)
