Zero Based and Incremental Budgeting

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
I would like a simple explanation of the above two types of budgeting, if anyone can help! :?

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  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Zero Based and Incremental Budgeting

    Incremental is using prior years budget plus an added percentage to allow for inflation and growith

    Zero based budget - Each cost has to be justisted to be included in the budget and effective starting a budget from scratch
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Zero Based and Incremental Budgeting

    It all becomes quite clear now, many thanks!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Zero Based and Incremental Budgeting

    No problem. Not sure if you are taking the advanced cert or intermediate but it may be worth you looking at the pros and cons for both types of budget.

    In some papers ive done they have asked which budget method is preferable.

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