PART one
Respond to the following in a minimum of 175 words:
What are all the required components of preparing a budget?
Who is involved?
What other external influences need to be considered?
What are the common pitfalls one can anticipate in budget execution, and how can budget execution system design assist in minimizing these pitfalls?
PART TWO
Respond with 175 words Mindy Shaw
To prepare a budget one must have the goal of the budget, a targeted amount, a detailed transcript of what is expected of the budget. Meaning a description of what the budget is for must be explained, without a reason for the budget it breeds inorganization. A budget also calls for constraints, possible support from the citizens, a proposal and research forecasted information supporting that budget. However, for direct preparation for a budget all that is really needed is someone to request the budget, someone to review it and someone to cut, disallow and or approve it. When determining the components needed for the budget it also depends on what type of budget is needed. “There is variation in who makes which decisions and who can overrule whose decisions”(Rubin, 2020). The two branches legislative and executive are involved in the budget process sometimes even with the governor itself. It is said that the Executive branch usually dominates the actual decision-making process however legislative can have equal footing. Another external influence that affects the budgeting process is the support of the citizens and or support of the budget itself. If the budget is ideal and reflect the agenda of the requestor then the approval odds may increase. If the budget is not popular among the executives or citizens then it will more than likely be denied, disallowed and or cut even. Some common pitfalls of budget execution can be revenue problems, the changing of the economy and poor predictions of the expenditures. The budget execution system design can assist in avoiding the pitfalls by thoroughly researching the budget and forecasting. If the forecasting method is utilized, then issues that occur are less complicated to handle when they attempt to derail or deviate from the budget. This will also help prepare ahead meaning the issues could possibly be handled without the use of the budget depending on the situation.
Rubin, I. S. (2020). Politics of public budgeting (9th ed.). SAGE Publications.
PART THREE Respond with 175 words Carilynn Tamayo
Greetings to all, budget preparation requires several key components to ensure accuracy, comprehensiveness, and alignment with organizational goals. For starters, establishing and defining financial goals should be an optimal priority. Revenue estimation should be the following step. It is crucial to identify the sources (sales, services, investments, grants, donations, etc.), as well as analyze past revenue trends and forecast future revenue. Expense forecasting should follow, as it allows for the categorization of expenses. Capital planning aids in identifying major investments such as equipment, technology, and infrastructure. Contingency planning is another vital component, as it identifies potential risks and prepare mitigation plans. Ongoing monitoring and continuous communication and training are also essential factors in budget preparation. Budget preparation involves key several parties. First and foremost, the finance team, who is responsible for the compilation of data, analysis and reporting. department leaders, executives/management, Board of Directors, employees, and finally, the stakeholders. Some other external influences to be considered are market trends and how those patterns affect the competitive landscape, and consumer behavior. The regulatory environment, as well as the political climate, are also key indicators. Tax laws, compliance requirements, and other legal considerations; as well as policies and national stability, are influential factors to also be considered. Some common pitfalls to anticipate in this process are, first and foremost, inaccurate forecasting and lack of communication. Another issue which can arise is failure to track performance against the budget in real-time, due to inadequate monitoring. In order to minimize these pitfalls, it is vital to set up and implement systems which provide up-to-date financial information. Another important resource is to utilize software that integrates planning, forecasting, and reporting. Providing ongoing training for staff on budget management and system use, is also vital to a successful execution of a budget. Finally, regularly reviewing and updating budget processes and systems based on feedback and performance analysis. These measures are not fool proof, they can however, mitigate and ensure timely resolution by reducing time and additional resources.
Rubin, I. S. (2020). Politics of public budgeting (9th ed.). SAGE Publications.
