The development on this budget report instrument aims to find out the right budget model for SME's in East Java. In general, the budget of a business is the basis for making decision. Ideally, business owners can easily estimate every purchases transaction and use of raw materials and other resource requirements. However, in reality the owners of SME's never make a written plan related to production such as raw materials and labor. Data was collects on developing this budget instrument using a questionnaire. This research using mixed method between quantitative and qualitative, used questionnaires, observation and interview to the owner of Business. The samples used from this study were 51 SME's spread in several cities in East Java. Based on the findings, the SME owners stated that they did not know the correct format of the budget report. The required budget formats include the sales budget, production budget, and raw material budget. The budget considered very important for SME owners because it is very representative of the usual production activities. Thus, it can conclude developing budget instruments for SME's includes the sales budget, production budget, and raw material budget.