Zero-Based Budgeting Method 

Definition

Budget that is created on the basis of planned data, in particular on the basis of simulated planned costs. In plant maintenance, this budgeting method is known as zero-based budgeting.

The budget is not determined on the basis of actual data (see history-based budgeting method), but on the basis of future planned tasks. Task lists and maintenance plans are drawn on as planning aids: the planned values of the services therein (labor, external services, material) are determined automatically and used as simulated costs to form the basis of the budget planning.

Structure

For the zero-based budgeting method, there are the following planning scenarios:

·        Task list scenario

Planning scenario that is based on the costs simulation of task lists.

·        Maintenance plan scenario

Planning scenario that is based on the costs simulation of maintenance plans.

·        Ad hoc scenario

Planning scenario that is based on ad hoc data.

For more information on how budget proposals are composed, see Budget Category.