Budgets

1. Budgets

2. Budget vs. Pricing • Pricing • 1 program • Seasonal • Drives budget • Budget • Multiple programs • Fiscal year • Deals with revenues & expenditures

3. Budget • Financial plan that outlines and forecasts the revenues and expenditures over a fiscal year

4. Some Terms • Fiscal year • Allocated & expended monies…

6. Some Terms • Budget cycle • Length of time required to prepare, administer & close out a single year budget

7. Budget Cycle Fiscal Year 2010 Fiscal Year 2011 Fiscal Year 2012 • National Park Service – 21 month cycle • 2011 is in progress • 2012 is under congress review • 2013 preparation is beginning

8. Why budget? • Prediction of resources • Prediction of a work schedule • Used to make decisions • Explains resource acquisition & expenditures to stakeholders • How goals are being met

9. 2 types of budgets • Capital • Major purchases lasting 10+ years • Facilities, renovations, equipment • Developed independently of operating budgets • Arbitrary cut-off expense set • Covers 5-6 years (CIP) • Priorities are reviewed & shifted annually

10. Normal Parks & Recreation Dept.

11. Bloomington Parks & Recreation Dept. CIF = Capital Improvement Fund OSLAD = Open Space Lands Acquisition and Development TEA = Transportation Economic Assistance

12. 2 types of budgets • Operating • Annual, routine activities • All revenues & expenditures for day to day operation

13. Operating Budgets • Line item budgets • Object classification budgets • Program budgets • Performance budgets • Zero based budgets • Running budgets

14. Line Item Budgets • Item • Specific item or object for which monies will need to be allocated • Postage, equipment • Line • Process of placing the items in a line so that all items appear on the budget sheet

15. Line Item Budgets Process • List all revenues • Fees program 1 • Fees program 2 • Other sources • List all expenditures • Staff • Utilities • Office supplies • Determine costs of each item Does not divide by fixed & variable costs…but these are still used in pricing.

17. $1127/ $1130

18. Line Item Budgets • Advantages • Flexibility • Add/delete items as needed • No coding system • Easy to administer • Doesn’t require ee to conform to a single system

19. Line Item Budgets • Disadvantages • Easy to forget items, thus no $ allocated • Confusion in comparing between departments • Used most often in an informal situation

20. OCB • Most common form of budget, similar to line item budgets • Object - item for financial cost • Salaries, phone bills • Classification – uniform method of grouping the objects into certain categories & subcategories • Personnel, Contractual services, Commodities • See handout

21. Example Classification Expenditure Classification by Object 2000: Services: Contractual 2100 Communication & Transportation 2110 Postage 2120 Telephone 2300 Printing, Binding, Advertising 2350 Advertising & Publication Notice Classifications Sub classifications Objects

24. Advantages to OCB • Uniform & standardized • Categories are provided • Easy to set-up • Can compare line items across areas

25. Disadvantages to OCB • May not be as flexible as needed • May not be able to find the category needed • Requires a lot of detailed cost estimates • Multiple items in a category • Repair to buildings • Advertising

26. Making Purchases • Charge account • Petty cash • Procurement card • PO….

27. Normal Amusements Address line 1 Address line 2 Purchase Order Date: _______________ PO #: 1234567 Vendor: ______________ Staff name: ___________ Requisition #: _________