The Concept Of "Beyond Budgeting" And The Improvement Of Comprehensive Budget Management

As a core element of corporate governance, the comprehensive budget management is one of the important means to promote the establishment, and the improvement of enterprise internal control mechanisms; it is also a way to implement the internal economic responsibility, and improve the financial management, and coordinate all departments to perform their duties. The comprehensive budget management plays an important role in the enterprise management; it makes decision concrete, and is the basis of control of business and production activities. But the change from industrial age to information age caused a noticeable increase in the uncertainties and competitions of enterprise operation environment. The traditional functions of control and performance evaluation of budget management have wavered, even some how shackles of enterprise management flexibility. Therefore, both the academes and practices have put forward radical theories that enterprises also can do well in operation and management when they are not to engage in the budgeting work. In the year 1999, in Europe CAM-I organized the Beyond Budgeting Round Table which brought forward the concept of Beyond Budgeting.In this paper firstly reviewed the theoretical research situations of comprehensive budget management and beyond budgeting management, and then elaborated the theories of the two concepts. On the basis of the theories, pointed out the deficiencies of budget slack, time consuming, and the misunderstanding of traditional comprehensive budget management. Moreover, analyzed the advantages and shortages of the beyond budgeting management. By contrast, although there are lots of problems and deficiencies in the traditional comprehensive budget management, it still remains the function to promote the effective allocation of resources for enterprises, and plays an important role to the achievement of business strategic objectives and increase the production efficiency. And also because the hard to implement and the self shortages of beyond budgeting, simply abandon the comprehensive budget management is inadvisable. So, this paper considered the approaches of succeeded European companies, introduced the idea of beyond budgeting management, though reforming the budgeting management organize structure, taking the usage of method of rolling budget, ABM, and establishing a comparing relative performance evaluation system to improve the traditional comprehensive budget management.