budgets. budget vs. pricing pricing 1 program seasonal drives budget budget multiple programs fiscal...
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Budget vs. Pricing
• Pricing• 1 program• Seasonal• Drives budget
• Budget• Multiple programs• Fiscal year• Deals with revenues & expenditures
Budget
• Financial plan that outlines and forecasts the revenues and expenditures over a fiscal year
Clear Water Rafting Company
Budget Statement - 1st & 2nd Quarters - End July 31
Actual Budget Committed % Balance
Revenues
Trips $42,113 $72,500 $0 58.1% $30,387
Concessions $8,671 $14,000 $0 61.9% $5,329
Store receipts $11,148 $20,000 $0 55.7% $8,852
Total revenues $61,932 $106,500 $0 58.2% $44,568
Expenditures
Staff $35,963 $52,100 $1,500 71.9% $14,637
Supplies $2,147 $3,100 $0 69.3% $953
Utilities $1,610 $2,430 $0 66.3% $820
Mortgage $8,051 $16,000 $0 50.3% $7,949
Marketing $2,684 $4,300 $500 74.0% $1,116
Maintenance $3,221 $4,300 $0 74.9% $1,079
Total expenditures $53,676 $82,230 $2,000 65.3% $26,554
Some Terms
• Budget cycle• Length of time required to prepare,
administer & close out a single year budget
Budget Cycle
• National Park Service – 21 month cycle
- 2011 is in progress
- 2012 is under congress review
- 2013 preparation is beginning
Fiscal Year 1999 Fiscal Year 2000 Fiscal Year 2001
Budget Close-out - 3 months
Budget Preparation - 3 to 9 months
Fiscal Year 2010 Fiscal Year 2011 Fiscal Year 2012
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
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
Project 2010-2011 2011-2012 2012-2013 2013-2014 2014-2015
Fairview Park Softball Field Fencing replacement $30,000
Underwood Tennis Court Rennovation $60,000
Shepard Park Development $750,000
Constitution Trail Repaving $40,000 $40,000 $25,000
Misc ADA imnprovements $10,000 $10,000 $10,000 $ 15,000 $15,000
Normal Parks & Recreation Dept.
Priority Project NameFinance Source Revenue Expenses
1LINCOLN LEISURE CENTER-CONSTRUCTION WORK CIF $220,000
2SKATEBOARD PARK-CONSTRUCTION CIF $170,000
3MCGRAW COMMUNITY PARK-2ND PHASE CIF $700,000
4MCGRAW COMMUNITY PARK-2ND PHASE OSLAD $400,000 $400,000
5MCGRAW COMMUNITY PARK-PARKING LOT CIF $550,000
6CONSTITUTION TRAIL(GROVE ST. SOUTH TO LAFAYETTE) TEA $1,000,000 $1,000,000
CIF = Capital Improvement FundOSLAD = Open Space Lands Acquisition and DevelopmentTEA = Transportation Economic Assistance
Bloomington Parks & Recreation Dept.
2 types of budgets
• Operating• Annual, routine activities• All revenues & expenditures for day to day
operation
Operating Budgets
• Line item budgets• Object classification budgets• Program budgets• Performance budgets• Zero based budgets• Running budgets
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
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.
Line Item Total
Revenue
Ticket Sales $1875
Reserve (Savings) $36
Total Revenue $1,911
Expenditures
Meal $900
Appetizers $131
Damage deposit $50
Rental fee $75
DJ $300
Mailing $53
Printing - invite $53
Printing - info sheet $14
Envelopes $60
Total Expenditures $1,636
REVENUESProgram fees $6400
EXPENDITURESFlights $1126.60Rental Car $268.59Hotel $2700.00Gas $323.40Meals $540.00City Walk $140.92Busch Gardens $130.90Titanic Exhibit $31.84Arabian Nights $113.20Universal Studios $157.60Disney Quest $56.24Walk Disney Theme Parks $377.02Medieval Times $134.72Sleuths Mystery Dinner $75.02Kennedy Space Center $76.00Wet and Wild $78.70Pleasure Island $33.70Ripley’s Museum $28.08
TOTAL: $6392.53
$1127/ $1130
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
Line Item Budgets• Disadvantages
• Easy to forget items, thus no $ allocated
• Confusion in comparing between departments
• Used most often in an informal situation
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
Example ClassificationExpenditure Classification by Object2000: Services: Contractual
2100 Communication & Transportation
2110 Postage
2120 Telephone
2300 Printing, Binding, Advertising
2350 Advertising & Publication Notice
Expenditure Classification by Object2000: Services: Contractual
2100 Communication & Transportation
2110 Postage
2120 Telephone
2300 Printing, Binding, Advertising
2350 Advertising & Publication Notice
Classifications Sub classificationsObjects
Table 13.2: Sample Object Classification Categories
Object total
Sub-category
totalCategory
Total1000: Personnel Services $2,037,000
1100 Salaries, Regular (Full Time) $1,500,0001200 Salaries, Temporary (Part time) $25,0001300 Wages, Regular (Hourly, FT) $250,0001400 Wages, Temporary (Hourly. PT) $175,0001500 Contractual employees $75,0001600 Other Compensations $12,000
2000: Contractual Services $641,2522100 Communication and Transportation $183,252
2110 Postage $5,0022120 Telephone $23,0002130 Freight and Express $10,0002140 Travel & Lodging $70,0002150 Vehicles $32,0002160 Gasoline, Oils and Lubricants $43,250
2300 Printing, Binding and Advertising $16,4752310 Printing/Photocopying $12,0002320 Typewriting/Word Processing $5002330 Binding $5002340 Photocopying & Blueprinting $2502350 Advertising & Publication of Notices $3,225
Table: 13.4: Combination of a Program Budget and OCB
Object totalSub-category
total Category Total
1000: Personnel Services $802,100.00
1100 Salaries, Regular (Full Time) $600,000.00
(12) Membership $160,000.00
(13) Marketing $80,000.00
(14) Meeting planning $120,000.00
(15) Special events $240,000.00
1200 Salaries, Temporary (Part time) $190,300.00
(12) Membership $50,000.00
(13) Marketing $45,000.00
(14) Meeting planning $72,300.00
(15) Special events $23,000.00
1300 Wages, Regular (Hourly, FT) $11,800.00
(12) Membership $1,200.00
(13) Marketing $2,400.00
(14) Meeting planning $3,200.00
(15) Special events $5,000.00
Advantages to OCB
• Uniform & standardized
• Categories are provided
• Easy to set-up
• Can compare line items across areas
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
Normal AmusementsAddress line 1
Address line 2
Purchase Order
Date: _______________ PO #: 1234567
Vendor: ______________
Staff name: ___________ Requisition #: _________
Quantity Description Unit price
Total price
Code
1 Basketball backboard…
$450 $450 24–6170-13
10 Adult League Basketballs
$17 $170 24–6172-13
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