NAMBUYA ANNAMISCA2025-09-122025-09-122025-09-09https://hdl.handle.net/20.500.12311/2949This study examined the impact of budgeting practices on the financial performance of small and medium enterprises in Uganda a case study of Bugujju village in Mukono Municipality central division, with specific objectives to examine the effect of budgetary control, the impact of record keeping and the challenges faced by SME owners in implementing effective budgetary practices. The study was carried out to establish why most Small and Medium Enterprises continue to perform poorly financially despite management efforts to improve performance through motivation, government initiatives to support private sector programs and market opportunities. To collect relevant data the researcher used questionnaires, short interviews and library research on relevant material. Data was analyzed by the use of descriptive methods such as percentage distribution and frequency distribution. The findings revealed that budgetary control has a significant positive effect on financial performance, enabling SMEs to manage resources better, reduce costs and make informed decisions. Furthermore, accurate and timely record keeping was found to have a significant positive impact of the financial performance facilitating financial reporting, analysis and decision making. However, the study also identified several challenges faced by SME owners in implementing effective budgeting which were limited financial expertise, inadequate resources like money and failure to keep up with the ever changing market conditions like price fluctuations. The area of further study suggested was the impact of financial management practices on SME sustainability and investigate ways to improve access to finance SMEs in Uganda.en