Three disadvantages:
One, it may not take into account high-level strategic considerations since the budget is being decided by mid level managers.
Two, due to large number of employees involved, it tends to take longer to create a budget.
Third, there could be budgetary slack.
by
Muhammad Kamran Bukhari , Manager Finance , OIC Ministerial Standing Committee on Scientific and Technological Cooperation(COMSTECH)
1.They consume more time and therefore are more expensive2.The advantage of management participation may be negated by failure to implement the budget by senior management leading to dissatisfaction similar to that experienced with imposed budgets.3.Such budgets may cause managers to introduce budgetary slacks ( A budgetary slack is a margin set between what can be achieved and what managers state will be achieved)4.Managers may be unqualified to participate and therefore the budgets may be unachievable5.Participatory budgets may support empire building by sub-ordinates.6.An earlier start to the budgeting process maybe required when there is uncertainty about the future.
