Introduction
The purpose of this paper is to describe and provide an overview of the budgeting and planning process for Valencia College.
Overview
The budget and planning process at Valencia College is an annual process where the college sets aside time to discuss and reflect on their priorities and decisions for the upcoming year. Conducting an annual budget planning process allows Valencia the flexibility and ability to adjust to the changing needs and demands over time. It also requires college-wide accountability.
The Presidents of each of the campuses are responsible for managing capital budgets and creating operating budgets. Once the budget has been completed, the President then submits it to the College-wide President and the Board of Trustees for review. The Board then provides recommendations on revenue and expenditures and how resources should be allocated.
Valencia College takes a measured approach with regard to forecasting revenues based on the external environment and unknown variables. In the event that savings are achieved, those funds can be used to improve academic programs and to meet the needs within other areas at the college.
Valencia begins the budget planning process each year in August. Each division of the college is responsible for the development of their individual budgets for the upcoming fiscal
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year as well as the upcoming three fiscal years. The campus President gives each Division Dean preliminary allocations as a beginning point for the development of their budgets. The Deans, therefore, have latitude in determining the allocation of funds in their divisions. Unit-Level Budgeting In higher education there is a multi-level budget process. This is known as a unit-level budgeting process, which is a decentralized process that makes each unit or division responsible for creating its own budget. After each division head creates their budget, it is then send to the Campus President to be aggregated with the overall budget of the campus. While the Dean is ultimately responsible for the completion of the budget, there are a team of managers and Directors that have a part in the development of the final budget. Space and Facilities Allocation The college also gives the campus President the authority to decide the allocation of space as it relates to the college’s physical resources. How space is allocated is part of the biannual capitol plan, which includes building improvements, new construction, maintenance and repairs, and property purchases. This plan and it projections are outlined in the college’s budget. Priorities for this plan are determined by the campus president in collaboration with the administration of the college. Each division is responsible for submitting a list of capitol projects, rationale, and how the project will support the strategic priorities of the college. All capitol projects are presented to the campus President for final campus budget authorization. In 2015, Valencia College approved a plan to create a new building for the multi-media programs of the college. The building is expected to be completed in the next two years. Financial Review Each year, Valencia conducts one formal financial review and one informal review for the upcoming fiscal year plus two future fiscal years. Also reviewed is the existing fiscal year activity so that major issues may be resolved and year-end forecasts are updated in accordance to anticipated year-end results. These reviews, conducted in September and January, are attended by the campus Deans, the Business Manager and the Campus President. Both the central administration and the units put significant effort into preparing for financial review. These reviews are critical for the successful development of the comprehensive college budget. The Business office reviews the latest quarterly reports for each unit and does a thorough analysis of all of the components of the budget. This analysis is assisted by supporting documents provided by the respective units. As is necessary, the Business office staff work with the Deans to resolve any issues. Each of the operating budgets is reviewed in depth to ensure the allocation amounts agree and that only approved commitments for funding have been included. As a check, the Business office reviews the current year forecast and trends to decide the accuracy of the budget for the upcoming fiscal year and the forecasts for two additional years. Budget Book The final step in the creation of the operating budget for the college is preparing the budget book. During this step, the business office puts together each of the budgets that were produced by the Deans along with other areas of the college to complete overall budget. In the budget book, is the budget containing information for the upcoming fiscal year and the forecasts for the two years following. Along with the financial statements for the upcoming budget year, the Budget Book includes a complete compilation of supporting details and schedules for each of the major areas of the budget (tuition and financial aid, sponsored projects, fundraising, endowment and investment, compensation, international operations, information technology, debt, and capital plan). The Budget Book also includes a financial ratio analysis for historical years, the current year forecast, the upcoming budget year, and the two additional future fiscal years. Assessment of Financial Strength and Performance The finance division of the college is responsible for monitoring and assessing financial performance through a number of monthly, quarterly or annual standard practices. At the conclusion of each fiscal quarter, the finance team reviews the budgeted and financial results. The abundance of analyses that are used to support this review are then compiled into the “Quarterly Book,” that is used as a reference point for future use. The Quarterly Book contains both the quarterly financial statements and the budget and forecast data. After the statements are the chapters that contain detailed analysis of tuition and fees, gifts, sponsored projects, accounts receivable, salaries and benefits, operating expenses, international and satellite operations, treasury activity, subsidiaries, capital projects, ratio analysis and the debt issue. A significant part of the year-end procedures consists of preparing the Quarterly Book for the fourth quarter. At the conclusion of the fourth quarter, a more in depth analysis of year-end balances is performed in each of the major areas noted above. The year-end process concludes with the sign-off of the independent auditors, issuance of the annual report, and other required filings. Conclusion/Recommendations Colleges allocate scarce resources to programs and services through the budgeting process. Because of this, it is of great importance that administrators be diligent in the management of funds. As the focal point for key resource decisions, the budget process is a powerful tool. A budget process that is well-integrated with other activities of the college, such as the planning and management functions, will provide better financial and program decisions and lead to improved operations. A process that effectively involves all stakeholders----Presidents, Deans, Directors, and other staff ---- and reflects their needs and priorities will serve as a positive force in maintaining good stakeholder relations. The budget practices outlined above take into account, and respect, the individual needs of each division. Various budgetary elements are essential components of each principle. This structure allows practices to be categorized in a useful manner. The framework and the compendium of good budget practices are intended to serve as tools to assist colleges in improving their budget process. Among the benefits are: • Educating colleges and budget participants about the potential of budget systems, • Helping colleges assess the adequacy of their own budgetary systems, • Providing guidance to colleges that want to improve their budget processes, and • Promoting education, training, and further experimentation and research on techniques that work. Following are recommended budget practices as outlined by the Government Finance Officers Association: A Definition of the Budget Process “A good budget process is far more than the preparation of a legal document that appropriates funds for a series of line items.
Good budgeting is a broadly defined process that has political, managerial, planning, communication, and financial dimensions. The following definition recognizes the broad scope of the budget process and provides a base for improvement of the budget process. The budget process consists of activities that encompass the development, implementation, and evaluation of a plan for the provision of services and capital assets. A good budget process is characterized by several essential features. A good budget
process: • Incorporates a long-term perspective, • Establishes linkages to broad organizational goals, • Focuses budget decisions on results and outcomes, • Involves and promotes effective communication with stakeholders, and • Provide incentives to government management and employees. These key characteristics of good budgeting make clear that the budget process is not simply an exercise in balancing revenues and expenditures one year at a time, but is strategic in nature, encompassing a multi-year financial and operating plan that allocates resources on the basis of identified goals. A good budget process moves beyond the traditional concept of line item expenditure control, providing incentives and flexibility to managers that can lead to improved program efficiency and effectiveness. The Mission of the Budget Process
For government budgeting to be effective, the process that guides it must be an evolving one. As the government gets bigger, it will most likely destabilize the existing method. Therefore, it must change to keep pace with the demands and growth of the country. The process must be capable of handling the complexity of our nation and its multifaceted needs so it will always need revisions and restructuring to face these new challenges. Its ultimate goal must be to reinforce the government and strengthen the country.
• To oversee the financial performance of the school ensuring the money is spent effectively and how it is spent
The purpose of this paper is to investigate capital budgeting decision under Galaxy Science Centre (GSC), which is non-profit organization. The need for such an analysis emerges from the case that only provides general information concerning the impact of capital budgeting decisions in the presence of strategic interactions among GSC. We are facing significant problems in different conditions, then through all given figures to make the best recommendations fro GSC.
When considering the nature of the federal budget, indeed one can trace the foundations of budgeting back to biblical principles. Inside the community of faith, the bible has often been considered the cornerstone and reference point for authoritative declarations. Thus, when applying a biblical perspective to the nature and context of the federal budget, one must begin with the nature of property and stewardship within biblical context. As conveyed in the lecture notes, “God delegated to man the authority over external things, and hence, one could conclude stewardship and ownership from Genesis… God also has authority over all humanity, in the sense that we ‘are not our own,’ and what we own is not to be ‘privately’ administered in exclusion of God.” Therefore, when discussing the federal budget in correlation to the biblical text, indeed the allocation of resources, the distribution of wealth and the overall stewardship of believers are controlled by God. As scriptures states, “God blessed the and God said to them, “Be fruitful and multiply and fill the earth and subdue it, and have dominion over the fish of the sea and over the birds of the heavens and over every living thing that moves on the earth” (Genesis,1:28,ESV).
Budgets are the financial requirements and consequences of plans. Budgets are made with specific goals in mind. Budgets can be used to lower living expenses, increase savings, or to save for a purpose such as: education or retirement. Budgeting is a process that involves these actions: defining goals, gathering information, forming expectations, reconciling goals and data, monitoring goals and variances, adjusting budgets, and redefining goals.
The budget process, according to Marshall, is to "develop and communicate" how an organization' economic, industry, and organizational strategies will be effected within the budgeted time frame. (p.497) People within the organization from planners, economists, and managers contribute facets of the strategic budget process in order to meet organizational needs. Upper management then typically approves those budgets. The operating budget is the forecast of activity that encompasses the results of the budget ...
Participative Budgeting is the situation in which budgets are designed and set after input from subordinate managers, instead of merely being imposed. The idea behind this sort of budgeting is to assign responsibility to subordinate managers and place a form of personal ownership on the final budget. Nearly two decades of management accounting research has resulted in equivocal findings on the consequences and effects of participative budgeting (Lindquist 1995). Participative budgeting certainly has various advantages, these include the transferral of information from subordinate to superior increased job satisfaction for the subordinate, budgetary responsibility and goal congruence. Its disadvantages include budgetary slack and negative motivation, however it is the conditions in which participative budgeting takes place determines whether the budgeting process is successful. The conditions are dependent on various factors such as the level of participation, level of subordinate influence, the extent to which budgetary slack takes place, volatility, job related information, and the complexity of the budget.
In this section of the report, we shall discuss the interlinked processes of Activity Based Costing, Activity Based Budgeting and Activity Based Management by using the help of certain diagrams and also touch upon the evolution of the Activity Based approach over time.
In management, each of the four functions, planning, organizing, leading, and controlling, are crucial to the development of any business. Involving employees in the planning process help them understand the goals of the organization. Planning is analyzing a situation, determining the goals that will be pursued, and deciding in advance the actions needed to pursue the goals. This paper will evaluate the planning function of the Halliburton Company and analyze the impact that legal issues, ethics, and corporate social responsibilities have on management planning along with examples of each, and analyze three factors that influence strategic, tactical, operational, and contingency planning.
Budget is combining your income and expenses to decide how much money you are going to spend on an item. Budget is an important step to determine your financial health and financial stability. It’s an important financial tool because it can help plan for expenses, cut cost were unneeded, save for future goals, plan for emergencies that occur inexpediently, and list what you are spending and saving.
Capital budgeting is one of the primary activities of a company. Most of the company uses capital budgeting for decision making process of selecting and evaluating long-term investment. The company have to make a right decision with respect to investment in fixed asset such as purchasing of new equipment and delivery vehicles, constructing additions to buildings and many more. The decision must be right because of the project involve huge amount of cash outflow and it is committed for many years.
I learned a few things about my school and myself in regards to this area of leadership by participating in this activity. I learned that my school asks for very little participation from the teachers and community in regards to the budgeting process. But it could be an excellent venue to review prior year accomplishments as well as decide on future objectives with these stakeholders. If I were an administrator, involving the community and faculty would not only help in maintaining awareness, but I could also use this as a way to help those who may not be directly vested in my school, but who are helping fund it through their taxes, recognize effective administration in our efforts to reduce costs and provide needed resources to the various programs. I also feel that budget decisions cannot be solely programmatic or solely monetary. There needs
It requires an adequate and sound organizational structure, that is, there must be a definite assignment of responsibility for each function of the enterprise. Budgeting compels all the members of management, from the top to bottom to participate in the establishment of goals and plans. Budgeting compels departmental managers to make plans in harmony with the other departments and of the entire enterprise. Budgeting helps the management to put down in figures what is necessary for a satisfactory performance. Budgeting helps the management to plan for the most economical use of labor, material and capital. Budgeting tends to remove the cloud of uncertainty that exists in many organizations, especially among lower levels of management, relative to basic policies and objectives. Budgeting promotes an understanding among members of management of their co-workers' problems. Budgeting force management to give adequate attention to the effects of general business conditions. Budgeting aids in obtaining bank credit as banks commonly require a projection of future operations and cash flows to support
In regards to school finance, the ultimate goal of school administrators is to provide all students with the most cost effective, comprehensive education that meets all federal, state, and local requirements and that reflects the values and beliefs within the community. This means that it is an expectation for schools to equip all students equally with the best possible educational opportunities that a community is willing to furnish. However, to accomplish this, school administrators must be able to sustain school programs throughout various economic periods.
Performance budgeting encompasses the causal relationship among program funding and the probable results of that program and uses this information as a means to develop an actual budget. A major focal point of performance budgeting is accountability; this type of budgeting is often utilized by administrators to obtain cost efficiency and establish useful budget forecasting.