Budgets are a measure of the results expected for the planned activities for a company. Whether you formally plan budgets or not, you will be working against several – Revenue, Production, Expense, Financial, Investment and so on.
Once these budgets are recorded, they require periodic review to understand deviation. Once this happens, you would probably take decisions on course corrections, record possible outcomes of these changes (as scenarios) and compare against the budgets once again.
This is a powerful planning mechanism that provides the flexibility to work in a changing /dynamic environment.
With Tally.ERP 9, you can set up any number of budgets. To make this easy, budgets can roll up into 'group' budgets and these can roll up again into 'master' budgets. The people who come up with the budgets can make entries and the roll-up is automatic (and can be overridden at the rolled-up level as well).
While viewing any report, you can choose to pull up the budgeted figures as well, along with a variance column. You could just as easily pull up budget figures alone and make these available to various people.
A 'scenario' is the name given to a specific combination of vouchers that will be included to deliver a report. You can include different voucher types and build as many scenarios as needed – say one where a product launch is on time and another where it is delayed by three months. You could then view actual figures against a scenario. You could also see the variance between a scenario and the budget!
Budgets and Scenarios are powerful tools when used by themselves; used together they deliver unprecedented power to help plan & monitor your business.
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