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Preparing a Budget: Top-down and bottom-up approach

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Identify and describe a project where the top-down budgeting approach would be most appropriate. Detail your rationale for the decision and list the advantages for using that approach. Next, identify and describe a project where the bottom-up budgeting approach would be most appropriate. Provide your rationale for deciding on the use of that approach and list the advantages of using it.

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Managing project budgets TOP DOWN

Top down would be all direction coming from the Project Manager. All objectives, guidelines, information, plans and funding would be determined by the Project Manager. This would include all budgeting. The expectations would be communicated to the project team.

An example of a Top Down budgeting Approach

In a company where I worked: Linamar Corporation, the owner Frank Hasenfratz started the company and was very skilled at the operations. When you would take on a project, he would control all budgets and be able to identify any ...

Solution Summary

This solution looks at top-down budgeting and the advantages of this approach. Examples are given of bottom-up budgeting and appropriateness of the approach. Advantages are listed.

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Please help by providing a 125-word response to each of the following questions:

How does a capital budget originate and what is it suppose to accomplish?

How are corporate responsibilities divided in preparation of the budget?

What are the advantages and disadvantages of the budget originating from top executive offices to middle management or from middle management to top management?

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