budget formulation

Budget formulation is the process of creating a financial plan that outlines expected revenues and expenses for a specific period, typically a year. It involves assessing current financial resources, prioritizing spending areas based on needs and goals, and deciding how much money will be allocated to different programs or projects. This planning helps organizations—such as governments or businesses—set financial priorities, control spending, and ensure resources are used effectively to achieve objectives. Once formulated, the budget serves as a guiding document for financial decisions and accountability.