Budget process is the result of every planning process, and on the basis of the budget is assessed the reality of achieving the goals in relation to the planned. The key assumption for successful budgeting is the quality of planning process and setting goals. Based on the budget it is possible to analyze in detail all categories of revenues and expenditures and compare their condition with the planned and with previous years. It also allows making projections for future periods. An important assumption for planning and budgeting is the balance between revenues and expenditures. During the work, the budget of the City of Benkovac, a local unit that belongs to budget users, is analyzed and categories of revenues and expenditures are described and analyzed. Budget is the base for successful city operation, providing resources for all users and normal functioning of the system. Most of the budget revenue is made up of taxes, which make it possible to allocate funds for new investments. It can be said that the budget is like a circle because the collected revenues are again spent in the form of expenditures and so on.