Text 6 budgeting

Exercise 6.1

Study the vocabulary:

1	budgeting	1	складання бюджету
2	to motivate	2	спонукати
3	operating plan	3	виробничий план
4	to anticipate	4	очікувати, передбачати
5	primary	5	основний, найважливіший
6	framework	6	рамки, межа, структура
7	fiscal year	7	бюджетний рік, фінансовий рік
8	arbitrarily	8	довільно, випадково
9	master budget	9	головний бюджет
10	control device	10	контрольний засіб, стандартний план діяльності бізнесу

Exercise 6.2

Match the words with their meanings:

1. budgeting	a) довільно, випадково
2. to motivate	b) контрольний засіб, стандартний план діяльності бізнесу
3. operating plan	c) рамки, межа, структура
4. to anticipate	d) головний бюджет
5. primary	e) бюджетний рік, фінансовий рік
6. framework	f) виробничий план
7. fiscal year	g) основний, найважливіший
8. arbitrarily	h) складання бюджету
9. master budget	i) очікувати, передбачати
10. control device	j) спонукати

Exercise 6.3

Read and translate the text:

The preparation of a budget is an important aspect of a company’s success. The preparation of it helps management to establish short-term and long-term goals and standards for the company, motivate employees to achieve company goals, provide for a systematic review of performance. The success of the budgeting process depends on the cooperation of all employees.

Budget (of a business) is the financial operating plan for an organization for a fixed period. The budget shows what income is anticipated and how the resources will be used during the budget period. It is a forecast used by a business to plan and control.

The primary objective of the budget is to establish a financial framework for the operations of the business. The accounting period for the budget is usually either the calendar year or the fiscal year. The fiscal year is any arbitrarily chosen twelve-month period that does not correspond to the calendar year.

The total of separate budgets from different departments within a company that shows in detail how the entire business operates is called master budget. As the business year progresses, management can use the budget as a control device that permits monitoring of the company’s operations.

Exercise 6.4

Read the text again to find out which of the following statements are correct:

1. The preparation of a budget is an important aspect of a company’s success.

2. The success of the budgeting process depends on the cooperation of all employees.

3. The success of the budgeting process depends on the chief accountant.

4. Budget of a business is the financial report about past performance.

5. Budget of a business is the financial operating plan for an organization for a fixed period.

6. The budget shows what income was earned and how the resources were used during the last year.

7. The budget shows what income is anticipated and how the resources will be used during the budget period.

8. The primary objective of the budget is to establish a cheering atmosphere in the company.

9. The primary objective of the budget is to establish a financial framework for the operations of the business.

10. The total of separate budgets from different departments within a company that shows in detail how the entire business operates is called master budget.

Exercise 6.5(a)

Match the phrases and words with their meanings:

1. успіх компанії	a) forecast
2. довгострокові цілі	b) the primary objective
3. процес складання бюджету	c) income
4. встановлений строк	d) company’s success
5. прибуток	e) the budgeting process
6. прогноз	f) a fixed period
7. найважливіша задача	g) long term goals

Exercise 6.5(b)

Match the phrases and words with their meanings:

1. головний бюджет	a) fiscal year
2. контрольний засіб	b) the budget period
3. контролювання роботи компанії	c) operating plan
4. виробничий план	d) monitoring of the company’s operations
5. бюджетний період	e) control device
6. бюджетний рік	f) master budget

Exercise 6.6

Match words from list A with words from list B that have a similar meaning:

1. operate	a) sum
2. goal	b) allow
3. to progress	c) main
4. achieve	d) expect
5. systematic	e) definite
6. fixed	f) regular
7. anticipate	g) reach
8. primary	h) to develop
9. permit	i) objective
10. total	j) function

Exercise 6.7

Match words with the correct definition:

1. budget	a) an aim or target.
2. master budget	b) a statement about what one thinks will happen in the future.
3. control device	c) the people who control a company.
4. forecast	d) the total of separate budgets from different departments within a company.
5. the fiscal year	e) the main internal workings of business.
6. management	f) a standard plan for the performance of a business by which its operations may be measured and regulated.
7. objective	g) a plan of expected income and expenditure for a particular period of time.
8. operations	h) related to a 12-month period of business activity.

Exercise 6.8

Fill in the gaps with the appropriate word or phrase:

motivated budget financial year Budgeting budgets budget fiscal year accounting monitors total

1. The financial director is responsible for the firm’s … .

2. … involves setting financial goals and standards for an enterprise.

3. Our company’s … is the calendar year, January 1 to December 31.

4. The new channel will be launched with a $3 million promotional ... .

5. A desire to go to business school … her to study mathematics hard.

6. She was given a … of € 25 000 to launch the magazine.

7. In the UK, the government’s ... runs from 6 April to the following 5 April.

8. Our financial manager will calculate the total profit at the end of the ... period.

9. The boss … the quality of her employees’ work.

10. The … of this month’s sales is up 20%.

Exercise 6.9

Fill in the missing prepositions:

for for by for in of of

BUDGETING

Budgeting is the process …1… preparing budgets and exercising budgetary control. Budgeting encourages forward thinking …2… managers; serves to help coordinate different functions and departments …3… the firm. It defines the responsibilities …4… individual managers, provides a framework …5… delegating responsibility; and provides an instrument …6… control., and a basis …7… modifying plans, where necessary.