22. The most important part of budgeting is:

A. The budget itself

B. Review of actual results against the budget

C. Knowing how much each manager has available to spend in their department

D. Communication between managers and finance in setting the budget

Often overlooked, the most important factor is the review of results against expectations! Although in some organisations, the budget is perceived as the “pot of cash” or the amount that a manager has to spend, the true essence of budgeting is comparing what happened with what was expected – and then interpreting these results, and taking action where necessary.