Business Improvement
The spirit of business should be kept inside the heart. This is very important because this is our main capital to stay and exist on the business track. Beside that we should have a creative ideas (more…)
Archive for December, 2009
Are there signs of budget massage?
Budget massage is common when senior managers, instead of policing capital spending; merely compare a unit’s spending to its forecast. In this environment, shrewd managers manipulate their budgets, shuffling expenditures between their capital and annual operating budgets, to achieve steady year-to-year capital budgets. This way, they (more…)
Are managers shifting short-term costs to the capital budget?
In some departments, executives “manage” their costs by shifting spending to capital accounts. Their knowledge of basic accounting tells them that short-term costs that run through the income statement diminish department profitability more than costs that are capitalized in the departmental budget and then depreciated. Recommendation: If possible, controllers should ask department managers to include analyses of after-tax capitalized costs in their budget requests.
