What aspect of budgeting involves adjusting the budget based on performance and outcomes?

Revising the budget is essential in ensuring that it accurately reflects the organization's current needs and goals based on performance and outcomes. This process allows an organization to respond to variances between the expected and actual performance, which can be influenced by changing economic conditions, unexpected expenditures, or new priorities.

Revising goes beyond the initial budget creation, involving a critical analysis of how resources have been utilized and what outcomes have been achieved. By identifying where adjustments are necessary—whether that means reallocating funds, cutting costs, or investing more in successful areas—organizations can ensure they remain aligned with their strategic objectives and make informed decisions for the future. This iterative process is key to effective financial management, maintaining accountability, and optimizing performance.