This section will describe the general steps that a company takes in its process of budget formulation. After that a brief description of the modern techniques of budgeting will be made with the intention that the concept of budgeting system can be understood more clearly. With a clear picture of the system of budgeting, it will now be helpful to discuss certain roles that budgeting plays within an organization. Thus, roles of budgeting as an instrument for planning and control have been depicted in the next section. The research paper then takes a move towards the practicalities of implementation of budgeting system in the real world by examining its scope in PepsiCo. In this section, the system that PepsiCo follows has been analyzed critically by taking data from the official site of the company. The annual report has been taken care of and also the financial result of third quarter of 2010 has been considered in order to evaluate the efficiencies of its budgeting system. The research paper concludes with a few recommendations for the improvement of budgeting system in PepsiCo. The recommendations are made on the basis of investigation of the current scenario of the company and also on the basis of the certain general traits that a company requires to follow with regard to its budgeting system.
The research paper has been prepared to analyze the budgeting system with respect to a company. The budgeting system of the company which will be analyzed in this research paper is PepsiCo. Inc. PepsiCo is one of the world’s biggest producers of foods, snacks and beverages. It has revenue earnings of over $60 billion and has 2, 85, 000 employees. The company was founded by Donald M. Kendall, CEO and President of Pepsi-Cola and Herman W. Lay, CEO and Chairman of Frito-Lay. The company was the creation of the merger of the two companies. The company has grown largely over the