Allocations

Allocations refer to the process of distributing financial resources or costs to various departments, projects, or cost centres within an organisation. This practice helps in tracking and managing expenditures, budgeting, and assessing the financial performance of different parts of the business.

Allocations can include:

Budget Allocations: Distributing the overall budget across different departments or projects based on their needs or strategic importance.

Cost Allocations: Assigning indirect costs, such as overheads or administrative expenses, to specific departments or products to determine their true cost and profitability.

Resource Allocations: Assigning financial resources to different investment opportunities or business activities to maximise returns and achieve organisational goals.

The aim of financial allocations is to ensure that resources are used effectively and that financial performance is accurately measured and reported.