• Timely analysis - This function is the one most people would identify as a benefit of budgeting.  The budget is the one document that enables an organization to evaluate performance relative to its' goals on a timely basis.

   

• Performance control - The benefit of having timely analysis is that it enables the organization to adjust to changes from the budget by shifting resources to maximize results.

   

• Resource allocation - Once you've constructed the budget model, the model affords the opportunity to say "what if" to different scenarios and resource allocations and determine the impact of alternative courses of action.

   

• Managerial instruction - Inevitably there will be variances from the budget and some maybe significant.  Budgeting provides useful instruction.  Constant monitoring and analysis of performance demonstrates to management mistakes in judgment and how to avoid future mistakes.

   

• Consensus and support - Unless you're a one person organization, the budgeting process helps create a concensus of ideas, strategies and direction.  When the budget is agreed upon, the organization has a unified direction.

If your organization already is budgeting, keep up the good work.  If you're not currently preparing a budget, why not?  As you can see the benefits easily outweigh the costs.