Business and Adminitration

Unit six: Principles of budgets in a business environment


You should use this file to complete your Assessment.
The first thing you need to do is save a copy of this document, either onto your computer or a USB drive
Then work through your Assessment, remembering to save your work regularly
When you’ve finished, print out a copy to keep for reference
Then, go to and send your completed Assessment to your tutor via your My Study area – make sure it is clearly marked with your name, the course title and the Unit and Assessment number.

Please note that this Assessment document has 7 pages and is made up of 3 Sections.

Name: Szilvia Pek

Section 1: The purpose of budgets

This section will help you to evidence Learning Outcome 1: Understand the purpose of budgets in a business environment.

|Learning objective                                                                           |Place in Assessment                               |
|1.1 Explain the purpose of budgets for managing financial resources to meet business         |Question 1 Page 1                                 |
|requirements                                                                                 |                                                   |

1. Why are budgets used to manage financial resources? [1.1]

Budgeting is dealing with money, the organisation / company’s money, sponsor’s money, other private funder’s money, but in every scenario, you are dealing with money.

Managing financial resources effectively and efficiently is a standard for financial and performance management and this means, reasonable value for money

Good budget management will help your company to:

make effective and efficient use of resources
achieve objectives and fulfil commitments to stakeholders
become more accountable to donors and other stakeholders
gain the respect and confidence of funding agencies and partners
gain advantage in...