A good budgeting system forces managers to examine the business as they plan, so they can:

Question

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Setting specific expectations against which actual results can be compared is one of the primary purposes of budgeting. However, budgeting also serves to help managers identify areas where historical records may not be accurate, and to ensure that the budgeting task is completed on time. Getting promoted for doing a good job is not necessarily a direct result of using a good budgeting system, although it may be a possible outcome.

A Good Budgeting System Forces Managers to Examine the Business