Budget development for the next fiscal year begins in which quarter?

Budget development for the next fiscal year typically begins in the third quarter. This timing allows organizations to assess their financial performance for the current year while making projections for the upcoming fiscal year.

During the third quarter, financial managers often analyze revenue trends, spending patterns, and overall economic conditions that impact the organization's performance. Gathering this data is crucial for making informed decisions about resource allocation and setting realistic financial goals for the next year.

Additionally, starting the budgetary process in the third quarter allows ample time for adjustments and collaboration among various departments within the organization. They can submit their requests and needs, which can then be reviewed and prioritized leading into the formal budget drafting process that occurs in the fourth quarter. By the time the fourth quarter arrives, most organizations are in a position to finalize their budgets for approval, having already accumulated necessary insights and data during the third quarter.