3.4 Most Common Methods and Techniques for Controlling

Q: What are the most common methods and techniques for controlling?

3.4.1 The Traditional Control Devices (the Budget)

A widely used device for managerial control is the budget. Indeed, it has sometimes been assumed that budgeting is the device for accomplishing control.

Budgeting is the formulation of plans for a given future period in numerical terms. Thus budgets are statements of anticipated results, in financial terms - as in revenue and expense and capital budgets - or in no financial terms - as in budgets of direct- labor hours, materials, physical sales volume or units of production.

Through numerical statement of plans and breaking of these plans into components consistent with the organization structure, budgets force and correlate planning and allow authority to be delegated without loss of control.

However, there are many types of budgets such as:

                                     ·           Revenue and expense budgets

                                     ·           Time, space, material, and product budgets

                                     ·           Capital expenditure budgets

                                     ·           Cash budgets

                                     ·           Balance sheet budgets

                                     ·           Budget summaries

                                     ·           Zero- base budgeting