Post: Gaurav Akrani. Date: 2/23/2011 07:03:00 PM IST. Comment (1) Label: Economics .
What is a Budget. Meaning and Concept
Government has several policies to implement in the overall task of performing its functions to meet the objectives of social & economic growth. For implementing these policies, it has to spend huge amount of funds on defence, administration, and development, welfare projects & various other relief operations. It is therefore necessary to find out all possible sources of getting funds so that sufficient revenue can be generated to meet the mounting expenditure.
Planning process of assessing revenue & expenditure is termed as Budget.
The term budget is derived from the French word "Budgette " which means a "leather bag" or a "wallet". It is a statement of the financial plan of the government. It shows the income & expenditure of the government during a financial year, which runs generally from 1 st April to 31 st March.
Budget is most important information document of the government. One part of the
government's budget is similar to company's annual report. This part presents the overall picture of the financial performance of the government. The second part of the budget presents government's financial plans for the period upto its next budget.So, every citizen of a nation from the common man to the politician is eager to know about the budget as they would like to get an idea of the :-
- Financial performance of the government over the past one year.
- To know about the financial programmes & policies of the government for the next one year.
- To know how their standard of living will be affected by the financial policies of the government in the next one year.
Definitions of Budget
According to Tayler. "Budget is a financial plan of government for a definite period".
According to Rene Stourm. "A budget is a document containing a preliminary approved plan of public revenues and expenditure".
Components of Government Budget