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BUDGETING MEASURES
- @Performance measures should be linked to specific program goals and objectives
- @Give priority where goals are achieved
- @Measures should be valid, reliable and verifiable (quantified assessment)
- @Performance budgeting (outcome) links the budget by establishing performance measures agreed upon by managers and decision makers
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BUDGETING MEASURES (CONTINUED
- @Measures efficiency (outcome per unit resource) and effectiveness (within specific time frames) of program goals
- @Assesses level of productivity in providing goods and services (workload)
- @Workload should emphasize purpose and accomplishments of agency/department
- @Measure program outcomes (intended results achieved)
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PROGRAM COMPONENTS
- @Clearly defined service area
- @Processes
- @Activities and tasks
- @Planned outcomes or achieved results
- @Link expenditures and revenues to goals, objectives and outcome
- @Expenditures and revenues are related to specific functions
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GOOD OBJECTIVES
- @SMART
- Specific
- Measurable
- Attainable
- Results oriented
- Toward goal
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PERFORMANCE MEASURES
- @Effectiveness-the degree that goals and objectives are met within deadlines
- @Efficiency-the amount of outcomes per unit of resources allocated to an objective
- @Workload- the level of productivity of staff in providing goods and services to customers
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PERFORMANCE BENCHMARKS
- @Should be developed to aid in assessing how well a function, program or activity meets needs or purpose
- @Comparative standards that prove a frame of reference for evaluating program/service quality or effectiveness
- @Should be consistently defined and measurable
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FORECASTING REVENUE
- @Estimating revenue is the first step in determining the level of resources that will be available for budget appropriations
- @Influenced by
- •Administrative factors
- •Political factors
- •Economic factors
- •Policy factors
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FORECASTING REVENUE (CONTINUED)
- Uses analytical techniques to estimate
- @Should be decentralized with process to achieve on the forecast
- @Establishes a spending target
- @Projects the overall future financial condition-capital spending and debt
- @Should extend over a period of at least 3 years
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QUALITATIVE METHODS
- @Consensus, judgmental and expert •Expert-uses economists and social scientists to study trends
- @Best judgment-informed decision based on history and general economic conditions. Used for revenues that have a high degree of uncertainty
- @Weaknesses
- •Responds to political pressures
- •Focus on current issues/events
- •Lack of comparability overtime
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QUANTITATIVE METHODS
- @Relies on numerical data enabling testing to see if underlying data assumptions are met
- @Requires extensive amounts of historical data to generate dependable projections
- @40 data points
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FORECASTING REVENUE METHODS (CONTINUED)
- @Econometric modeling uses economists and social scientists to study trends forecast revenue using equations that include values for multiple variables that influence the amount of revenue to be realized (example: permit fees)
- @Simultaneous equations modeling is a more complex econometric model, which forecasts revenue by using a system of equations
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FORECASTING REVENUE METHODS (CONTINUED)
- @Economic factors that influence
- @Utilities predict stable stream
- @Value vs. consumption
- @Number of customers
- @Cost
- @Typical stats
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CALCULATE NET PRESENT VALUE
- @Based on future benefit
- @Price deflators
- • US Department of Commerce publishes a number of price deflators
- • Deflated budget figures are only useful for making comparisons of buying power for different years when they are adjusted for inflation
- • PI is based on a mix of goods purchased by individuals
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REVENUE RESTRICTIONS
@Florida Statute 218.25 constrains the use of State Revenue Sharing for debt service in excess of guaranteed entitlement amount
@Deductive method of impact fee determination uses cost of providing the service in a specific location instead of averages or benchmarks
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CGFO AWARD REQUIREMENTS FOR AWARD
- @Budget as a policy document
- @Budget as a financial plan
- @Budget as an operations guide
- @Budget as a communications device
- •Reviewed by three judges
- •Provide comments
- •Mandatory requirements
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BUDGET AS A POLICY DOCUMENT
- @Statement of entity-wide long-term financial policies
- @Budget message that articulates priorities and issues for the budget for the current year only
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BUDGET AS A FINANCIAL PLAN
- @Summary of major revenues and expenditures, as well as other financing sources and uses to provide an overview for all total resources
- @Summaries of revenues and other financing sources and uses for the prior year actual, current year budget andlor estimated current year actual and proposed budget year
- @Describe major revenue sources (75% of them), explain the underlying assumptions for the revenue estimates and discuss significant revenue trends
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FINANCIAL PLAN (CONTINUED
- @Projected changes in fund balances, as defined by the entity in the budget document
- @Discussion of the causes and/or consequences of any change in fund equity greater than 10%
- @Budgeted capital expenditures
- @Financial data on current debt obligations and description of the relationship between current debt levels and legal debt limits
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BUDGET AS AN OPERATIONS GUIDE
- @Describe activities, services or functions carried out by organizational units
- @Include an organizational chart
- @Schedule or table summary of personnel or position counts for prior, current and budgeted years
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BUDGET AS A COMMUNICATIONS DEVICE
- @Description of processes for preparing, reviewing and adopting the current year's budget and procedures for amending the budget after its adoption
- @Use charts and graphs to highlight financial and statistical information
- @Include a table of contents
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