Up until the year 1954, the financial advisory to the Chief of General Staff and the budget department in the Ministry of Defense were comprised of two separate units. In that same year, the two offices were joined and Moshe Kashti, the financial advisor to the Chief of General Staff, was appointed to advise the deputy chief of general staff on financial and budgetary matters in the Ministry of Defense. While officially joined, the two units still operated separate of each other. In 1956, Moshe Kashti, financial advisor to the Chief of General Staff, was appointed to the position of Chief of the Financial Branch. In 1958, the budget department was separated from the financial branch and made a part of budget branch in the ministry of defense. From then on the financial advisor to the Chief of General staff would also the chief of the budgetary branch. In order to assure the proper administration of the budget, the position of deputy general manager was created for financial and economic issues. That particular office condenses the communication with the treasury department and administrates the acquisition budget, research and development, production of defense systems. The new department deepened the involvement of the Ministry of Defense in matters pertaining to research and development projects and in the allocating of resources as well as the development of security industries and equipment industries.

The management of the budget office of the Ministry of Defense, and administration of communication with the treasury department and administration of the equipment budget, is done by the deputy general manager of financial and economic issues. The deputy general manager is also responsible for hidden reserves and for the production of budgetary source material to assist the general manager of financial and economic issues. These source materials allow the Ministry of Defense to broaden the scope of research and development and production in Israel. The office also invests in the development of advanced weapons system- such as missiles and in the development of defense industries and has been doing so since the Six Day War. In the mid 60's following a reinforcement of the Ministry of Defense, the department began to have more decision making power and influence in the acquisition of equipment and were responsible for foretelling future budget plans. The reason for all these changes and improvements was due to the appointment of Levi Eshkol to the position of Defense Minister (in place of Ben-Gurion) in 1963. The new appointment strengthened the position of the Chief of General Staff in influencing security matter (Yitzchak Rabin who had been appointed Chief of General Staff in the start of 1964 greatly benefited from Eshkol's system); the resignation of Shimon Peres as Defense Minister; the attitude during Rabin's era was one of working to strengthen military involvement in various budgetary matters. This resulted in the closing of the deputy general manager of finance and economic department and the distribution of equipment budgetary responsibilities and the administration of communication with the treasury department within the financial advisory to the Chief of General Staff Unit (Budget Branch).