Research On Improvement Of Enterprise's Budget Management

Budgeting is the cornerstone of the management control process in nearly all organizations, the use of it is largely due to its ability to weave together all the key thread of an organization into a comprehensive plan. Since 1990's, the business environment of enterprises have changed enormously, the practitioners argue that budgets are rarely strategically focused, put emphasis on financial results, constrain responsiveness and are often a barrier to change. So we need to study the new trend of the budgeting management in western countries, so as to make the guideline for the improvements of budgeting practices of domestic enterprises.This dissertation includes five chapters. Chapter one reviews the evolution of budget management, describes its basic concepts, analyzes its essence from the perspective of enterprise theory and management theory. The author believes that the development of those theories will result in the advancement of budget management.Chapter two describes the changes of the business environment of enterprises from the outside and inside perspectives. Then discusses why practitioners have become dissatisfied with budgets, reviews some of the most common criticisms of traditional budgeting in practice.Chapter three and four present two distinct approaches which have been recently proposed by practitioners in the U.S. and Europe to address what they believe are shortcoming of traditional budgeting practices. One approach is Activity-Based Budgeting which advocates improving the budgeting system by marrying a more complete, activity-based operational model with a detailed financial model. It primarily focuses on the planning problems with budgeting. The other approach is Beyond Budgeting which takes a more radical view -- abandoning the budget. It primarily focuses on the performance evaluation problems with budgeting, advocates decentralizing the organization and empowering lower-level managers and employees. In chapter three and four, the author places them in a research context and analyzes the main thrust of two recent practice-led developments in budgeting.Chapter five analyzes the feasibility of the above two approaches in domestic enterprises. Then investigates the status quo of budget management of domestic...