What is Activity Based Budgeting?
How does it differ from traditional budgeting techniques? Activity Based Budgeting (ABB) is a technique for enhancing the accuracy of financial forecasts and increasing management understanding. When automated, ABB can rapidly and accurately produce financial plans and models based on varying levels of volume assumptions. Also, ABB eliminates much of the needless rework created by traditional budgeting techniques. ABB analyzes the products or services to be produced, what activities are required to produce those products or services, and finally what resources need to be budgeted to perform those activities. Simply said, ABB is the reversing of the ABC process to produce financial plans and budgets. What kind of software do I need and what are some of the pitfalls in doing an ABM pilot project? The most important element in completing an ABM pilot is how well the activity analysis is done and the depth of understanding of the ABC/ABM process from the bottom to the top of the organizati
