What is involved in formulating a budget? In its approval and execution?

Question

What will be an ideal response?

Answer 1

For budget formulation, the administrator must anticipate all types of expenditures–that is, payment for goods or services, to settle a financial obligation indicated by an invoice, contract, or other such document–and predict expenses related to major incidents or events that might arise. Certain assumptions based on the previous year's budget can be made, but they are not necessarily accurate. With the city/county manager's proposed budget request in hand, the governing board begins its deliberations on the budget. The manager may appear before the board to answer questions concerning the budget; individual department heads also may be asked to appear. After everyone scheduled has spoken, the city council or county commission directs the manager to make further cuts in the budget or to reinstate funds or programs cut earlier, and so on. The budget is then approved. The third stage of the process, budget execution, has several objectives: (1) to carry out the organization's budgeted objectives for the fiscal year in an orderly manner, (2) to ensure that the department undertakes no financial obligations or commitments other than those funded by the city council, and (3) to provide a periodic accounting of the administrator's stewardship over the department's funds.