department budgeting Essay

Submitted By jylyman

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When it comes to department budgeting, I would prefer variable expenses. As safe and organized as fixed budgets are, I don’t like the feeling of being constricted to a certain amount of funding. Variable expenses are more incentive based because the more income your generating the more profit your making, and more money is available for things such as reconstruction of departments, raises, department funding, marketing, etc. For example in my job, we have the ability to treat kids in our facility to outings and parties based on good behavior. This is unpredictable and would be hard to do on a fixed budget.
Some pros of a fixed budget is how consistent it is, and doesn’t take a lot of thought. Day by day, month by month, you can know what to expect. However, it does take a lot of discipline and stringent financial planning. The biggest issue in my department (milieu department) is full time employees and budgeting their hours. We have a fixed income for payroll, so it is crucial to avoid overtime and manage people who are on the clock.
Pros of variable expense is you have the flexibility to make decisions on case by case situation. Funds can be distributed to the areas that need attention rather than being strictly enforced to a fixed budget per department. However variable budgets take a lot of thought and time to distribute funds.

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