Discuss problems with the planning process


Problem: When constructing a budget, a company may face poor communication of necessary information or even misinformation within their data used to construct their budget. Proper information is needed to build a strong budget for the year. Having clear and well monitored data is needed. Time is also a barrier; it takes a long time to build a budget. Most companies begin making their budgets four to six months before the start of the new budget year. Making sure they have defined their priorities and allocated the proper amount of time is important. After this is set follow the plan, some companies do have to regularly analyze their budgets monthly and make changes as they come. Another barrier to making your budget may come in the form of "gamesmanship" this is when someone gives false or distorted information, this can lead to a false budget. Senior members of management are encouraged to eliminate or discourage this problem because it can lead to problems with the planning process and the accuracy of the business and management evaluations.

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