A key factor in the context of budgetary control refers to a factor that influences all other budgets. It is an important element that has a significant impact on the overall budget and its allocation. Understanding key factors is crucial for effective budget preparation and control.

Explanation:
Budgetary control is the process of establishing budgets, comparing actual results with the budgeted ones, and taking corrective actions to achieve desired outcomes. It involves the identification of key factors that can influence the budgetary process. These factors can vary depending on the organization and its specific circumstances, but they generally have a broad impact on the budgetary control system.

The key factor in budgetary control is a factor that affects all other budgets. It can be a macroeconomic factor, such as changes in the overall economic conditions, interest rates, or tax policies. For example, if there is an economic downturn, it may result in reduced consumer spending, which can impact sales and revenue projections, affecting all budgets.

Key factors can also include internal factors within the organization, such as changes in production processes, technology, or market competition. These factors can affect the cost structure, production capacity, and pricing strategies, influencing the budgets of various departments or units within the organization.

By identifying the key factors, organizations can better anticipate and plan for potential changes and uncertainties. It allows them to develop more realistic and accurate budgets, taking into account the potential impact of these factors. This, in turn, enables effective budgetary control and helps in achieving desired financial goals.

In summary, a key factor in the context of budgetary control is a factor that influences all other budgets. It plays a crucial role in the budgetary process by shaping the overall budget allocation and determining the financial outcomes of an organization. Understanding and analyzing these key factors is essential for effective budget preparation and control.