Evaluating Budget Documents Essay

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A budget is a plan. It is a policy statement. It is a device for communication. It is an expenditure guidebook. How a government organization spends its money says a great deal about its mission and policy preferences. It explains the resources it will require to provide specific public services and addresses strategic priorities. Developments in budgeting theory, including performance budgeting, program planning budgeting, and zero-based budgeting have had an impact on the evaluation of government budgets. These results-oriented systems have improved the way budgets are developed and presented. Budgets are generally thought of as occurring in a one-year period called the fiscal year. In this context it will be referred to interchangeably as the fiscal year or budgetary year. The budget is the standard for comparing actual spending with planned spending. Public managers at the local and state levels must try to keep their spending within budget during the budgetary period; as a result, they face many challenges in meeting budget goals during economic downturns. The federal government, on the other hand, does not need to balance the budget from year to year, which has led to large federal deficits.

This week, you consider the repercussions of a federal deficit and a balanced federal budget. You also evaluate a budget using selected criteria.

An organization’s operational budget is no more than next year's action plan in financial terms. It should list major goals and objectives for the upcoming year, as outlined in an organization’s strategic plan. The budget must identify which programs or services best achieve those goals and estimate all expenses necessary to deliver them. Budget documents should also include expectations for revenue. Despite the necessary elements involved in all operational budgets, these documents can vary in quality from organization to organization. Each year, the Government Finance Officers Association (GFOA) awards government organizations for the quality of their budget documents, using criteria established in its Distinguished Budget Presentation Award Program.

In this Assignment, you evaluate a budget document using the above criteria. Review the criteria for the GFOA’s Distinguished Budget Presentation Award Program in the Learning Resources for this week. Then, select a public organization and a specific budget document from the organization.

Submit a 6- to 8-page double-spaced paper (not including the cover and reference pages) in which you do the following:

  • Briefly describe the organization and the budget document you selected.
  • Identify the specific type of budget document you selected.
  • Evaluate the budget document using GFOA criteria.
  • Explain whether or not the budget document serves the constituents and other stakeholders of the organization.
  • Use from the library at least two scholarly sources that were published within the past five years to support your paper. Be sure to follow APA guidelines when citing your sources.

Required Readings

Mikesell,  J. L. (2018). Fiscal administration: Analysis and applications for the  public sector (10th ed.). Boston, MA: Wadsworth. Chapter 4, "Federal Budget Structures and Institutions” (pp. 154-207)
Chapter 5, "State and Local Budgets” (pp. 214-251)
Chapter 3, "Budget Methods and Practices” (pp. 106-142)
Chapter 6, “Budget System Reforms: Trying to Make Better Choices” (pp. 257-305)
Government Finance Officers Association. (2014). Distinguished Budget Presentation Award Program (Budget Awards Program). Retrieved from http://www.gfoa.co/sites/default/files/BudgetDetai...

Optional Resources  

Mucha, M. J. (2012, Oct). Budgeting for outcomes: Key findings from GFOA Research. Government Finance Review, 47–49. Retrieved from http://www.gfoa.org/budgeting-outcomes-key-finding...

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Evaluating Budget Documents
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A budget is a financial tool through which the approximation of revenue and expenses
earned or incurred in a span of a specific period; often referred to as a fiscal year or a budgetary
year; is done. Budgets apply for schools, businesses, government organizations, multinational
organizations as well as individual persons. For any organization, a budget acts as an expenditure
guidebook that shows how it uses its resources for the provision of services (Raghunandan,
Ramgulam, and Mohammed, 2012). It balances out the revenues and expenditure to avoid falling
into debt.
Most budget plans go hand in hand with the goals, objectives, and strategic plans of a
given organization. A budget attaches a financial value to the targets and transforms them into
understandable operative actions. Traditional budgeting techniques have failed to measure up to
the current trends in the business world. This has called for the development of alternative
budgets techniques which include but are not limited to beyond budgeting, activity-based and
zero-based budgeting, performance budgeting and program planning budgeting. Managers of any
given entity should strive to maintain the expenditure within their budget lest they fall into debt.
Organizational Operation Plan and Budget Documents
Any organization requires an operational budget for the smooth running of operations.
An organizational, operational budget is a financial tool that plans for those expenditures
necessary for maintaining the normal functioning of an organization. It estimates the likely
profits that an organization will earn if the assumptions of revenues and expenses prove right. It
may comprise of the resources necessary to meet the immediate agendas of the upcoming fiscal
year, which include labor costs, processing costs, maintenance costs, and administrative costs as



well as variable and fixed overheads. Developing an operational budget depends on numerous
assumptions and predictions based on past trends in sales, purchase prices, tax laws, government
policies, and the economy at large. This type of budget is important in proper tracking of income
and expenses and increases the efficiency of the running of the organization (Raghunandan,
Ramgulam, and Mohammed, 2012).
The development of a budget involves the use of budget documents. These are
documents that are released on a quarterly or monthly basis to give a comprehensive report on
the implementation of the year’s budget. A budget document should be exhaustive and at the
same time non-technical to explain the contents of the budget in a manner that people without
any knowledge in fiscal policy can understand. Budget documents are unique to different
organizations in terms of form, structure and terminologies, and quality. The Government
Finance Officers Association (GFOA) rewards organizations that develop budget documents of
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