BudgetSome companies turn a deaf ear when it comes to the "budget" issue. Companies have made great strides in the areas of sales and marketing, but have not been successful in the area of ​​budgeting. The budget is more important than ever in companies today. Competition is intensifying and acquisitions are becoming very common. The winners in this type of business environment will be those organizations that minimize unnecessary expenses and maximize the productivity of their resources. In this essay I have critically discussed the budgeting process in today's dynamic competitive environment. The budget is part of a company's annual plan. As defined by Glautier and Underdown (2001), “The budget is a quantitative statement for a period of time usually one year, which may include planned income, expenses, assets, liabilities and cash flows. The budget provides direction for the organization, helps coordinate activities, and facilitates control. "Glautier and Underdown (2001) went further in explaining this; “The budget is probably the most important tool a company can have.” It provides a game plan not only for long-term business operations, but also for day-to-day operations. Used correctly, budgeting can help a company achieve its goals, become more profitable and overcome difficult financial times budget The budget serves several management purposes. Probably the main purpose of the budget is to quantify the company's plan. of profit are achievable and realistic before implementing the plan. It also provides control over revenue and expenses during the budgeted year. Management compares actual results with budget forecasts and therefore must take into account any significant variances Significantly high budgets may indicate problems with business operations. Another important purpose of budgeting is that budgeting encourages communication and coordination among department managers within an organization. Departments support each other and use each other's services; the budgeting process then ensures that the right levels of support are available by allocating the right resources to the right department. Therefore, the budget provides managers with a tool to monitor programs, identify problems, and take corrective action. As Fisher (2005) states; “know where you are compared to where you want to be. If you're not there, you don't know which manager to hold accountable or fire.” Again, the budget serves as a vital management decision tool. Because management makes decisions throughout the year, budgeting helps you quantify the impact of those decisions.