ADVANTAGES OF ZERO-BASED BUDGETING
1. Results in efficient allocation of resources as it is based on needs and benefits
2. Drives managers to find out cost effective ways to improve operations
3. Detects inflated budgets
4. Useful for service department where the output is difficult to identify
5. Provides greater initiative and responsibility in decision-making
6.Increases communication and coordination within the organisation
7.Identifies and eliminates wastage and obsolete operations
8. Wasteful and obsolescent items of expenditure.
DISADVANTAGES OF ZERO-BASED BUDGETING
1.Very time-consuming and exhaustive.
2.Forced to justify every detail related to expenditure.
3.Necessary to train managers
4. Difficult to administer and communicate
1. Results in efficient allocation of resources as it is based on needs and benefits
2. Drives managers to find out cost effective ways to improve operations
3. Detects inflated budgets
4. Useful for service department where the output is difficult to identify
5. Provides greater initiative and responsibility in decision-making
6.Increases communication and coordination within the organisation
7.Identifies and eliminates wastage and obsolete operations
8. Wasteful and obsolescent items of expenditure.
DISADVANTAGES OF ZERO-BASED BUDGETING
1.Very time-consuming and exhaustive.
2.Forced to justify every detail related to expenditure.
3.Necessary to train managers
4. Difficult to administer and communicate