This paper deals with budgeting procedures in a multi-division firm. The global objective function of the firm is composed of maximizing the present value and minimizing the risk of the accepted projects. A weight is assigned to each one of these objectives. Different budgeting procedures are developed for the cases where these weights are known or unknown and for centralized and decentralized settings. In the cases where these weights are known, mathematical programming methods are suggested. However, in the cases where the values of the weights are unspecified, the notion of Discrete Efficient Frontier (DEF) is developed to represent sets of efficient (not dominated) combinations of projects. A simple measure of performance is developed for evaluating the effectiveness of the various budgeting procedures. This measure is based on the total area beneath the DEF. Finally, an extensive simulation study is carried out to see the effectiveness of the centralized vs. the decentralized procedures suggested in this study.