In the business world, finding the right budgeting strategy can be crucial to success. A top-down budget refers to a budgeting process in which management makes decisions about the company’s expenditure. Traditionally, budgets were created according to a bottom-up method. Bottom-up is just a top-down method flipped on its head. This article will tell you what top-down budgeting is and how it can impact businesses:
What is Top-Down Budgeting?
Top-down budgeting is when management arranges the company’s budget. The company’s senior management will meet and arrange a budget based on their objectives and goals for the company. To come to a final budget, the company’s management will take the current market into considerations. They will also discuss the previous year’s financial budget, how it worked, and if any changes need to be made to it or if they can implement the same budget. Senior management will also take tax, inflation, … Read the rest