How to build a control system of budget preparation
The main purpose of making any plans is to develop a pattern of actions that allow the competent and full use of all available resources of the enterprise. But often, for one reason or another, we do not always follow the plans. Therefore, one of the key points of financial planning is to monitor its implementation, because financial planning without feedback is a waste of both time and money.
The main purpose of creating a plan is to predict the development of the company, based on the experience gained in previous periods, and analysis of major trends that will lead to deviations from the average values. Thus, the evaluation of the execution of the plan is an assessment of the effectiveness of planning as such.
Analysis of what changes have occurred in the system and what actions should be taken to make ongoing adjustment of the system behavior based on data on its state, is the management of the current process or feedback. The presence of feedback makes the system viable. For a financial planning system, the feedback is control and analysis of the execution of plans and budgets.
