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  Budgets According to Time

Introduction to Classification of Budgets According to Time

As per to this classification, budgets are categorized in the following categories.

  • Short Term Budget:

Any budget that is ready for a period up to one year is termed as Short Term Budget. Functional budgets are generally prepared for a period of one year and then it is broken down month wise.

  • Medium Term Budget:

Budget ready for a period 1-3 years is Medium Term Budget. Budgets such as Capital Expenditure, Manpower Planning are ready for medium term.

  • Long Term Budgets:

Any budget exceeding 3 years is termed as Long Term Budgets. Master Budget is generally prepared for long term. In the modern days because of uncertainty, very few budgets are ready for long term.

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