An extremely important use of reports of actual results versus budget projections is:

The answer is "Identifying potentially troublesome areas so that corrective action can be taken".

A budget report is an inward report utilized by the board to think about the assessed, planned projections with the real performance number accomplished amid a period.

Budgeting and financial forecasting are devices or tools that organizations use to build up an arrangement of where the executives needs to take the organization and whether it's going the correct way. Albeit budgetary determining and planning are frequently utilized together, there are particular contrasts between the two.