The budget has three main usability are:

1. As a working guideline. The budget serves as a working guideline and provides direction and targets to be achieved by the company’s activities in the future.
2. As a means of coordination of work. With a budget of all the parts contained in the company can support each other and work together well, to get to the targets or goals set by the company.
3. As a means of supervision or control. The budget serves as the benchmark (comparison tool) to assess and evaluate the realization of the company’s activities in the future.

On the other side the budget also has disadvantages such as:

• The budget is just a tool.
• The budget does not replace the management.

The budgeting process:

• Finding the most difficult factor.
• Position the company in competition (Leader / Follower).
• Obtaining accurate data.
• Expert.

How the presentation:

• The number of accurate
• Informative
• Easy to see the movement

Business Budgeting is the overall plan of the company’s activities, which are expressed in units of (number) and within a certain time period in the future.

The main elements in the budget:

• The overall plan, the determination of the activities carried out in the future.
• The Company’s activity includes all activities to be performed by all sections of the company.
• Expressed in figures, is a unit that can be used on all the activities of various companies.
• A certain period, is the whole of what-what will happen in the future.

There are two kinds of budgets:

1. Strategic Budget, the budget is applicable to long term i.e. more than one accounting period (more than 1 year)
2. Tactical Budget is budget policies for the short term, i.e. one accounting period or less.

Budget prepared by the committee making up the budget (Budgeting Committee). This consists of the holder of the main functions (Participative Budget).