Study On Budgeting Management Of The Z Drilling Technology Research Institute

Since 2014, with the continuous drop of international oil price and the abrupt declining of corporate profit, the L oilfield company had an extremely great deficit and a normal state of difficult operation. At present, though there'll be more operation difficulties in the year of 2016, the L oilfield company has released a rather harsh profit target to the Z institute. Facing the great operation pressure from low oil price and high profit target, it will be our focus to study how to avoid function weakening of research and services caused by "money-driven" through regime construction, how we should deal with opening up sources in the external market and how to prevent financial risks in the process of creating income with all efforts.With the Z institute as the object, the paper analyzed the three major problems in the process of annual budgeting and performance assessment of the institute and proposed targeted solutions. The paper is divided into 6 sections, the 1st section is introduction; the 2nd section presents main budgeting and assessing management models both domestic and overseas; the 3rd section sets forth the current situation of the institute's budgeting and assessing management; the 4th section analyzes its problems in the process of budgeting and assessing management; the 5th section provides solutions towards the problems; and the 6th section is the conclusion.The paper focused on 3 problems:the first one is the function weakening of the Z institute under the pressure of low oil price and high performance target; the second is political posturing and cost shifting for money in the process of expanding the external market; the third is financial irregularities and capital recovery in creating income with all efforts.There are three performances of feature and innovation in this paper:the first is the innovative proposing of accreditation profit assessment and charging for internal services towards the function weakening of the Z institute under the pressure of low oil price and high performance target, which mobilized the enthusiasm of the staffs in functional and services departments and solved the problem of job marginalization for creating income with all efforts through making the hidden value explicit. The second is reinforcing early economic evaluation and carrying out the average profit rate assessment of multi-project, towards the problem of political posturing and cost shifting for money in the process of expanding the external market, in order to highlight the spirit of being steadfast in work, fill the holes of assessment and stimulation policy from superior and avoid violation risk of cost shifting. The third is lowering the risk of financial violation and bad debt through changing budget base, definite responsibility and strict awards and punishment details of clearing up defaults towards the problem of financial irregularities and capital recovery in creating income with all efforts.The paper has practical significance for the Z institute to complete budgeting and assessment in a regulation compliance and high efficient manner at the same time of standing fast to its own job, and will be an example and reference for other institutes in the industry.