Budgetary concepts and its formulations are important aspects of life. Budget is the statements made by accounting of revenue or income which is the estimates of inflows and outflows of the government and presented to the legislature.
The term ‘Budget’ is come from the word “Bougett” which means a sack or pouch and in other words it especially contains financial papers. The term ‘Budget’ used first time in the year of 1773. Formulation of the budget is estimates made for a financial year, as in India it is 1stof April to 31stof March every year. And the government has to made a budgetary statement contains estimates of expenditure, details of actual receipts and expenditure of closing financial year with any deficit or surplus in that year, economic conditions and policy of the calculating year having a eye on taxation, projects etc.
And in life there are lots of statements made by popular peoples compiled below:
F.A.Nigro: Financial administration is of special importance today for the simple reason that, while there seems to be no limits to what we may ask of government, there is always a limit to the funds available.
Kautilya: All undertakings depend upon finance. Hence, foremost attention shall be paid to the treasury.
Gladstone: Budgets are not merely matters of arithmetic but in a thousand ways go to the root of prosperity of individuals, the relations of classes and the strengths of kingdoms.
Willoughby: Budget is an integral and indispensible tool of administration. He also observed : “the real significance of the budget system lies in providing for the orderly administration of the financial affairs of a government.”
Aaron Wildavsky: Budget is the life blood of government.
Morstein Marx: Finance is as universally involved in administration as oxygen is in the atmosphere.
Definitions made on Budgets are:
Dimock:A budget is a financial plan summarizing the financial experience of the past, stating a current plan and projecting it over a specified period of time in future.
Wildavsky: A budget is a series of goals with price tags attached.
Willoughby: the budget is something much more than a mere estimate of revenues and expenditure. It is, or should be, at once a report, an estimate, and a proposal.
Harlod R. Bruce: A budget is a financial statement, prepared in advance of the opening of a fiscal year, of the estimated revenues and proposed expenditure of a given organization for the ensuing fiscal year.
Budgetary control is different form financial control as it is the continuous comparison of actual with budgeted results.Where formal statement of the financial resources set aside for carrying out specific activities in a given period of time.In which outputs are measured in monetary terms but are not directly compared to input costs is the revenue center. Units where inputs are measured in monetary terms but not outputs is called expenses center. Where performance is measured by the difference between revenues and expenditure. Inter organizational sales are often made using “transfer prices” is called profit centers. And investment center is where outputs are compared with the assets employed in producing them.
Hence budget is a future prospect which is made now taking in to account the past reviews of monetary gains or loss, estimation of inflows and outflows but with a limited fund.