Following are the characteristics of a good budget:

★ It is expressed in quantitative or monetary terms.

★ It is prepared for a fixed period of time It is prepared before the period in which it commences.

★ Practical to implement.

★ It spells out the objects and the policies to be pursued in order to achieve the objective of the organisation.

★ Many people are involved in drawing up a budget.

★ Flexible enough to allow changes in the changing environment.

★ Prepared on the basis of established standards of performance.

★ Analysis of cost and revenues.

★ On the basis of budget report performance of the organisation is constantly monitored.