ACCA · Question 18 · Budgeting
Section A
ReliefNet, a disaster relief NGO, has decided to switch from incremental budgeting to Zero-Based Budgeting (ZBB) for its administrative departments.
Which of the following are benefits of implementing Zero-Based Budgeting? (Select ALL that apply)
Answer options:
It eliminates historical inefficiencies by not assuming past budgets are automatically justified.
It is much faster and less time-consuming to prepare than incremental budgeting.
It automatically guarantees an increase in the budget for all departments.
It forces managers to justify all expenditures and evaluate alternative ways of operating.
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