Find an existing budget from a published source. Detail should be extensive enough to present a challenge.
1. using the existing budget, create a new budget for the next fiscal year. Set out the details of all assumptions you needed in order to build this budget.
2. Use this checklist for building a budget and critque your work
a. what is the proposed volume for the new budget period?
b. what is the appropriate inflow and outflow relationship?
c. what will the appropriate dollar cost be? (note: tihs question requires a series of assumptions about the nature of the operation for the new budget period)
d. Forecast service-related workload
e. forecast non-service related workload
f. forecast special project workload if applicable
g. Coordinate assumptions for propotionate share of interdepartmental projects
h. will additional resources be available?
i. will this budget accomplish the appropriate managerial objectives for the organization?
3. Use the checklist below for reviewing a budget and critique.
a. is this budget static or flexible?
b. are the figures designated as fixed or variable?
c. is the budget for a defined unit of authority?
d. are the line items within the budget all expenses (and reveues if applicable) that are controllable by the manager?
e. Is the format of the budget comparable with that of previous periods so that several reports over time can be compared if desired?
f. Are actual and budget for the same period?
g. are the figures annualized?
h. Test one line-item calculation. Is the math for the dollar difference computed correctly? Is the percentage properly computed based on a percentage of the budget figure?