GENERAL MOTORS BUDGETARY CONTROL.
The popular concept of budgets and budgetary control is probably based upon governmental budgets rather than upon budgets of industrial enterprises. This conception of budgets is reflected in the definition of a governmental budget as "a statement of probable revenue and expenditure and of financial proposals for the ensuing year as presented to and passed upon by a legislative body." The most important distinction between such a budget and the budget of an industrial enterprise is the emphasis upon rigidity and inflexibility which is inherent in the budgets of governmental units but which is entirely foreign to everyday business needs. Inflexibility is necessary in the case of Federal, state, and local governments since these units must be able to set up certain definite limits upon expenditures at the beginning of a fiscal period which will continue to be in effect throughout the period. In the case of General Motors Corp., budgetary control comprehends long-term and short-term planning, and includes, among other things, the current control of commercial expenses, manufacturing expenses, central office expenses, inventories and capital expenditures. These items must be at all times kept in harmony with the current rate of operations, and it has been found that flexibility in the basic budgets is a paramount need in securing such current control.
- DOI
- 10.2308/tar-8596573
- Volume
- 7 (1)
- Pages
- 22-30
- Language
- en
- Export
- BibTeX
- Sources
- openalex crossref