Budgeting organization - the question to be answered here is who performs which tasks in the budgeting process.
A distinction must be made between the tasks of budget preparation on the one hand and budgeting management for maintaining and further developing the budgeting system on the other.
Budget preparation is part of the line management's field of activity, with the same people generally being responsible for the action plans and budgets. The budget preparation has to be differentiated in terms of organizational structure in such a way that hierarchically subordinate positions develop budget proposals that are presented to the superiors for approval. The line management is mainly occupied with budgeting tasks during the planning period.
In contrast, a special body is usually created for the various tasks of budgeting management. The controller is of central importance here. Establishing and controlling the budgeting system as well as the supply of information for the budgeting units are among his main tasks. Large companies often delegate these tasks to independent budgeting departments. In addition, some large companies set up budget committees in which different company units are represented to distribute resources. However, there is a risk here that budgeting will be geared too much towards short-term corporate goals. The cost and benefit of budgeting must also be in an acceptable relationship.
The outlined separation of duties is not consistently adhered to in practice. Special budgeting bodies sometimes also take on material tasks, and line management in some companies also deals with formal tasks. As the company grows, the separation of duties approaches as described above.