PLANNING & BUDGET MANAGEMENT
PLANNING & BUDGET MANAGEMENT
WHY KNOW ABOUT BUDGET MANAGEMENT?
Every training program requires resources usually referred as people, purse and package. Money as a resource is to be studied as source and spending. The procuring of funds and spending funds are to be related to the achieving of the objectives – Hence there in a tri-polar relationship which must be understood.
A detailed analysis of sources of funding, norms of spending and relating the objectives is the purpose of audit. The entire financial management needs documentation – this topic covers the aspects of financial management of the aspects referred above.
What is budget and currency of budget?
Budget is allocation of financial resources to meet the expenditure of a training program, which has been approved in the annual plan of the institute. Budget has a currency only in the financial year in which it is sanctioned. When the fund is not utilized within the financial year, it lapses or it cannot be in currency and so cannot be used without a fresh sanction in the next financial year. So currency means use of budget in a specific time period – or financial year.
Essential characteristics of budgeting
Budget is a preliminary essential step, a guiding factor, to foresee the anticipated expenditure, for a program, so that no confusion is created at the end, resulting in lack of funds. Budgeting is mainly an exercise to know the available resources on the hand, and the requirement of the various programs on the other hand, so that decisions can be made about balancing the needs and resources and also prioritizing the various training/action research/extension programs. Budget is to be secured before starting a program, so that cost analysis can be done. Budgeting is an estimate. Budget is required for all in service, extension and action-research activities. the actual expenses may vary from the estimate. There should be consistency between the estimated budget and actual expenditure. In order to find out this, it is essential to work out the cost analysis from various angles.
How is budget provided?
The budget can be provided in several forms:
- Allocation of funds through an execution of order: the order has to be converted as cash by means of submitting a bill to the treasury. (AC or DC bill)
- Transfer of budget from one institute to the other through DD/Cheque. This money has to be creadited to the account of Head of the Institute and interested for the program and obtained in the form of cheque or cash. writing services
- Post performance payment or reimbursement basis :
One has to incur the expenditure out of contingency amount and submit the account for claiming reimbursement.
- Any other:
(a) Very rarely funds may be provided in cash for a program, which has to be spent within a specified period.
(b) The allocated funds for a specific program, but unutilized and deviated for a needy program have to be got approved, after devising new norms.