The Australian National Audit Office has identified the advantages of activity based budgeting: The Advantages - Output costs are supported by a schedule of costed activities - Opportunities to examine work processes - Identifies non value-adding activities that can be eliminated - Basis of a performance measurement system and direct link between strategic goals and operational realities - Enables cost profiles to be managed - Accurate costing data for operational management - Costs are transparent, understandable and actionable Disadvantages - Activity definition may become too detailed and the model may become too complex and difficult to maintain - Underestimation of the task of collecting activity driver data - Implementation may be considered a financial management fad and there is insufficient commitment from operational managers Activity Based Budgeting Disadvantages - Usually requires buying Activity Based Budgeting software - Requires training of all managers including budgeting department - Requires people to really understand what drives their budget - Eliminates excuse that activity volume changed because it makes visible volume changes - Requires everyone to collect or estimate activity volume By understanding how resources are transformed into products or services, and byfocusing on the cost of activities, activity based budgeting helps an organisation to obtain a greaterunderstanding of how costs behave in their organization and which activities create significant amounts of cost. You must wash off immediately to avoid getting germ infections, but you also have to make sure that you use the water efficiently. The water you use for taking a bath can still be used for flushing the toilet or for cleaning the floor. These are only few of the budgeting tips that can keep you healthy, at the same time make you resourceful. Many banks are now offering free PC banking and free personal finance software. You simply dial into the bank's computer or use web-based banking services, and download the checks that have cleared your account, directly into your personal finance software. Then you indicate an expense category for each check. In today's expensive living, budgeting should be practiced to give you power to rapidly gain control over your complicated spending. Your budget will help you in the development of your personal budgeting process, regardless of how much money you earn. Truth be told, it is not how much money you earn that you should concentrate on when making a budget. Between a house mortgage and a car mortgage, label the house mortgage as 1. Then study your budget pad. Could you cut down expenses on utility bills or transportation? If yes, how much would it raise to add up to fund the mortgage? Study all possibilities of cutting down your expenses. 3. SAVE FOR THE RAINY DAYS Effective debt management budgeting means not forgetting to save. If your solution to your financial stress is to take a long, hot soak to drown out those pesky calls from creditors, or go on a budget-busting online shopping trip, you may need to think again on your approach. Here are some tips to help you get your financial life on track. Start saving early. Whether you're saving for your kids' college education, a new home in a nice village, or a special out-of-the-country vacation, start saving early.