28 Variances Discussion - Ch 10 One of management's functions is to control company operations. Control consists of the steps taken by management to see that planned objectives are met. We now ask: How do budgets contribute to control of operations? The use of budgets in controlling operations is known as budgetary control Such control takes place by means of budget reports that compare actual results with planned objectives. The use of budget reports is based on the belief that planned objectives lose much of their potential value without some monitoring of progress along the way. Just as I and your other professors create assignments & assessments to evaluate your progress, top management requires periodic reports on the progress of department managers toward their planned objectives. These budget reports provide management with feedback on operations. Budget reports are prepared as frequently as needed. From these reports, management analyzes any differences between actual and planned results and determines their causes, Management then takes corrective action, or it decides to modify future plans. Budgetary control involves the activities shown in the picture below. WHY BOTHER TO BUDGET? SO WE CAN WORRY BEFORE WE SPEND MONEY AS WELL AS AFTER WE SPEND MONEY. STOCK.com Pick any company of your choice and discuss in >150 words, which variance(s) you believe (is) are the most important ones). You may focus on the cost variances that we discussed in chapters 9 and 10 or look at some that we did not get to look at or at least not in great detail, es variances between budgeted and actual sales revenue or budgeted and actual cash in/outflows. Please share why you feel this variances is of crucial importance and how often you believe a manager should look at the reports (e.g daily, weekly, monthly, quarterly). Once you share your discussion, make sure to post replies to at least two students with constructive opinions not just agreeing or not..relate your response to subject matter mention the material cover in class. There are 100 points possible for this discussion 20 points for Initial post . 50 points met 150 word requirement with original & substantive thought 30 points reply to aj feast2 classmates with own thoughts in 2-3 sentences