3.1 Analyze budgets and cash flow for decision-making process

3.1 Analyze budgets and cash flow for decision-making process

Cash flow forecasts and budgetary estimates are very important in the decision making process for any company because they foresee the financial position of the company putting all influencing factors into consideration. Budgetary estimates importance is indicated through variance analysis which forms the basis for decisions such as increasing advertisement expenses, checking on the level of wastage among other factors. The budget is also important in that it helps in measuring of performance and in forward planning thus a crucial factor in future decisions. A crucial aspect of budgets is the budgetary control system which is a technique that is used to compare the actual results and budgeted results (Singla, 2009). It usually has four

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