Improving Control Functions to Close the Gap between the Budget and the Actual Cost of the Vocational Training Center
The purpose of this study was to identify and analyse the factors the most considered in preparing budget plan for the Vocational Training Centre (VTC), as well as to determine the significant barriers in preparing it. Controlling the gap variance between the budget plan and actual cost, and improving those constrains that causing the gap will be the main purpose of this study. The research of this study will involve of some quantitative approach of financial analysis in the period of five fiscal years (1997/1998 - 2001/2002) which covers the document reports of: budget plan, operating expenses reports, prorated management, allocation key from other department, operating incomes from the third parties and capital investment. Those gathered financial information will be classified, summarized, tabulated and analysed. The horizontal and vertical variance analysis will be used to control the gap between budget plan and actual cost. For those unfavorable/significant results will be accompanied with a narrative explanation.nnVTC as one of corporate department of PT. Siemens Indonesia (PTSI) is regarded as a cost center, in this respect that VTC budget plan is subjects to responsibility and accountability of VTC manager to control that the actual operating expenses should not exceed the approved budget plan.nnThis thesis consists of four chapters: Chapter one covers the introduction, historical background, mission, task & objective, financial resources and the purpose of this study. Chapter two attempts to provide a literature review for this thesis. This chapter starts with strategic planning, business plan, budget preparation and controlling. Chapter three deals with finding and result. This chapter will examine the need for young technicians in the company, the absorption of VTC-graduates and the statistical of VTC enrollments are included. In addition, classification of budget plan, operating income and investment plan are also provided. The gap between budget plan and actual cost will be identified by using horizontal and vertical variance analysis. Chapter four deal with discussion and conclusion. The discussion focused on the implication of identifying needs and absorption of VTC graduates into the program and resources followed by identification of the main factors that causing of unfavourable variance between the budget and actual cost. In addition, the impact of operating income into the actual prorated management and the investment plan against the actual expenses will be discussed. In addition, mapping of interrelated budget, influence factors and related responsible department are also made to provide overview all conclusion of the thesis. The conclusion of this study may a valuable input for management of relevance institutions in dealing with control function on budget and operational expenses.
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