A budget is a financial document used to project future income and expenses. The budgeting process may be carried out by individuals or by companies to estimate whether the person/company can continue to operate with its projected income and expenses.
The process for preparing a monthly budget includes:
- Listing of all sources of monthly income
- Listing of all required, fixed expenses, like rent/mortgage, utilities, phone.
- Listing of other possible and variable expenses.
Budget planning entails identifying the sources of income and taking into account all current and future expenses, with an aim to meet financial goals. The primary aim of a budget planner is to ensure savings after the allocation for spending.Some of the major advantages of budget planning are:
- It puts checks or balances in place in order to prevent overspending at various levels.
- Takes into account the unexpected need for funds.
- Control of Non Plan, Plan & other expenditure.
Budget Planning in AICTE
By following good budgeting strategies, AICTE ensure the successful management of its expenditure and the recording of savings so that investments may be made for securing future. The following of steps for budget planning in AICTE:-
- Calculation of incomes from all sources, including grants, receipts and interest from investments.
- Determination of bills for essentials: List out essential expenses-including direct expenses, indirect expenses and capital expenses, which may include rent, telephone, electricity bills, repair & maintenance, printing & Stationery, legal charges, advertisement expenses & purchase. Calculation the amount spent on each head.
- Investment of funds in Fixed Deposit, Govt. Securities etc to generate fund for non-plan and unforeseen expenses including capital expenditures.