Research On The Value-created Oriented Enterprise Budget Management

With the increasingly rapid economic globalization, more complicated external environment of the enterprise's operation, collectivizing and internationalization of competitors, the competition between enterprises is becoming increasingly intensive. It is very important for enterprises to increase their competitiveness and adaptation. As a management tool for increasing enterprise's competitiveness, overall budget management has been generally accepted by modern enterprises. But in practice,on the one hand, traditional budget management is not adaptable to the current operational environment. On the other hand, many enterprise didn't plan and enforce budget management which is a performable and operable management control system. Therefore, it is urgent to improve traditional budget management and construct a new budget management system to adapt current operational environment.Budget management based on activities was developed with the just-in-time production, activities management, activities cost management, activity cost method. It verily combines strategy and business processes and verily realized overall process management of budget management. It represent the upcoming trend of budget management.But the research of budget management system based on activity system is far from enough. it lacks successful example as reference as far as application. Now, many enterprises apply just-in-time production, activities management. But budget management system based on activities is what they want to apply and don't know how to do it.This essay uses the method of combining theory with practice to construct the enterprises'framework of the budget management system with three main lines including system's construction, mechanism construction, and environment building against the background of a modern manufacturing company named ND. In the aspect of system's construction, it mainly discussed the goal of the system's function, and the key basal work of budget system based on the activities including distinguishing between activities and the centers of activities, the activity's processes, the cost driver of the activities, the cost quota based on the activities, standard costs of activities and so on. In the aspect of mechanism's construction, the essay discusses about operating mechanism of the whole budget management from the set up of the goal of budget to the preparation of budget, implementation of budget, budget analysis, performance assessment based on budget and the continuous operation improvement. In the aspect of environment building, it emphasizes on the discussion of the construction of budget management's organization, the distribution between responsibilities and rights involving budget management, developing the concept of the budget management and establishing standards of budget behavior.This essay gives you a panoramic view of activity-based budget management system's application framework for ND Company, which provides reference to other enterprises when they plan to introduce activity-based budget system.