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Research about Government Expenditure in a country and then compare it to another country - Essay Example

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A weak kind of budget reflects on the management of public expenditure that will not work well for the people. It then becomes…
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Research about Government Expenditure in a country and then compare it to another country

Download file to see previous pages... This is managed by the central state and its ministries, regional and local authorities, separate public bodies and international organizations.
The management of budget and finance is the responsibility of the Ministry of Finance and that of the Central Bank that exercises control on its use and allocation. This is done through a legislated agreement whereby all revenues are deposited to a Central Bank and could be withdrawn only through a legislature.
This study will focus on the impact of budgeting processes in the developing countries Sample steps of budget preparations to show how government expenditure is planned and implemented will also be discussed
The line budgeting system requires a listing of expenditures for the coming year. These are itemized according to objects of expenditures and quite often detailed as to where the budget item will be used for instance, how much money will be spent by the agency for personnel services, travel, maintenance, equipment and others. This system has been designed so that an agency will not overspend on their allocated budget for a specific item in a specified year. The advantage of the system is it is simple, easy to understand, expenses are controlled and expenditures are comparable with prior years.
While this type of budget management is simple and easy, World Bank sees its limitations such that it should be reformed to cope with the advancement of a rapidly and technologically changing world. WB experts see that line budgeting offers no explanations where budget has been spent; neither will it provide information on the programs implemented. It is short-sighted, as it is programmed for short term, e.g. one year, and does not take into account long-term approach.
Upon recognizing the limitations of line budget, another approach focused on performance basis was tried. This time, the activities of the agency is tied up with the budget. The basis of budget decisions depends on what ...Download file to see next pagesRead More
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