Budgeting is important so that companies

• can visualize the future and move in a focused direction.

• plan effectively.

• agree on and communicate organizational goals and objectives.

• develop quantitative translations of their goals and objectives.

• commit resources to desired activities.

• establish financial performance indicators of suc¬ cess.

• engage people to participate in the planning process.

• produce a spirit of cooperation among employ¬ ees and organizational departments or divisions.

• control operations and resource usage.

LO.1