Question

Usng a reliable source to back up your opinion, as a manager, what do you see as your role in the budget process AND what ethical considerations are there in the budget process? Provide a specific example related to your major as part of your explanation.

Answer 1

Being the member of the budgetary committee of our company to frame the annual budgets, my role always to allocate the financial resources and draw the spending decisions according to the requirement at the different parts of production and distribution cycle. This process involves paying attention to the material budget, labor budget and the promotion and distribution budget. We have to provide ethically correct direction to the budget of the company which will realize the goals and vision of the company at an economical cost and with financially sustainability. The company’s business has to be provided meaningful growth pattern through the framing of competent budget. The ethical consideration towards the drawing the budgets of the company are:

a) Responsibilities acceptance: The employee or the owner attached to each part of the company’s business should recognize his or her responsibilities to fulfill all the budgetary duties. The duties are being performed within the policies framed and goals to achieve towards the returns to shareholders, the community and the environment at-large.

b) Honesty through heart: The employees should perform their duties with no self-consideration but to achieve the company’s goal. The resources are allocated towards the right point of the business activity ie. genuine allocation. The financial deals and transactions should be clear, accurate and transparent enough to be ethically accepted. The proper accounting of the various activities of the business will demand a trust worthy reporting to the shareholders.

c) Reduce Interest conflicts : The interest conflicts should be declined to implement the budget and its requirements corner to corner to achieve the goals of the company. Honestly the resources should be allocated to the adequate production center with any personal conflicts. Timely financing to the budgetary activities should be done to prove the loyalty towards the company.

d) Humanity, harmony and decency: The business is matrix of internal offers and External persons or customers’ acceptance, so employees to make the per-planning or budget a successful event should behave humanly with decent remarks with the suppliers, customers and other employees. The budget so laid down should be accepted by each and every employee in the right sense. The opposition of the budget should be made in a decent way.

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