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Published online by Cambridge University Press: 05 March 2012
The budget is the amount of money handed to each department to allow it to deliver the business plan. The budget is a tool for control since monthly underspend or overspend identifies that the plan is not being followed.
The budget cycle
In an ideal world the contract is agreed before Christmas. The business plans are determined in January and the budgets for each part of the organization signed off before the end of February in time for the Board to agree them in March before the start of the financial year.
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