The Research On Budget Management Based On Resources Allocation

Budget management is useful to establish modern company system and scientific management and strengthen internal management. Budget management is an advanced managing method. It combines short-term operation goal and long-term strategic goal. It has the advantages of mechanism, strategy and general participation. Budget management is used outside China for about several decades. But for our country, there are many problems to be solved. This article is about these questions.This article firstly introduces the origin and development of budget and on this base it discuss the conception and the functions of budget management, analysis the existing budget management modes and budget making methods. It also analyses the existing resources allocation methods. On the above analysis, we do research on budget management.In the process of budget management, firstly, we analyze the resource allocation situation of some listed company in our country and find that waste is general. It is urgent for the companies to strengthen internal control. Companies can allocate and control resources according to budget. The determining of the budget goal is the beginning of the budget management. Companies can establish budget control system, introduce goal programming to assure the realization of budget goal.We find the principal-agent problem is existing between the budget compilers and executors on the base of principal-agent theory. The budget slack is such a problem. Through some research on its course and premise, we find that we can establish good internal system or use compensation plan which combine performance evaluation and budget resource distribution. In the end of the article, we analyze the relation between budget management, strategic management and performance management. We think that these three aspects are undivided and budget management is the connection of the other two.