02:51
Faizan
Budget remaining at year-end? What happens then? First, understand what a budget isn't. It is not a bucket to accumulate funds for various activities. Neither is it a straitjacket, nor a scheme to show what we can't do. A budget is a highly directed tool-designed to achieve specific goals. It is our best estimate of time, talents, and money to reach particular goals. I repeat; the budget is not money to spend irresponsibly as we approach year-end.
We budget to try to ensure we have resources to do our goals in the budget period (usually one year). We don't focus on the budget remaining in isolation, at any point. Instead, we look holistically at the goal and the resources needed to complete it.
When we budget, we start with goals and then calculate resources we need to do these goals-time, skills, and money. Once we complete the objectives, the budget expires, even if we have a budget remaining. This is the only way to prevent silos and encourage the effective use of resources.
Budget Remaining After Completing Goals Needs Reassigning
After completing our goals before year-end, we shouldn't be prodigal like governments and find creative ways to waste the budget remaining. When we achieve the target (or goals), we don't spend funds over-estimated. We don't know the future, so it is reasonable we did not budget correctly. "Return funds" to the "central pool" for optimization in the organization. Conversely, when we under-estimate, we need to re-examine our goals, and as needed, request extra funds or change the goals to stay within the budget.
One reason governments waste our tax dollars is they focus on money alone-the size of budgets-instead of goals and programs, and the best ways to do them. Another reason is they get away with this practice, and we expect governments to be profligate and inept.
When doing the budget, we must select the best path to the goal as weidentify potential gaps and opportunitiesthat might arise during the budget period. This approach is obvious, but many folks don't do it. Either they don't prepare a budget, or they budget after they start their journeys. Alternatively, they focus on money independent of their goals. Thoughtful budgeting before the event allows us to examine alternatives to show likely paths to handle potential gaps and opportunities.
We budget to try to ensure we have resources to do our goals in the budget period (usually one year). We don't focus on the budget remaining in isolation, at any point. Instead, we look holistically at the goal and the resources needed to complete it.
When we budget, we start with goals and then calculate resources we need to do these goals-time, skills, and money. Once we complete the objectives, the budget expires, even if we have a budget remaining. This is the only way to prevent silos and encourage the effective use of resources.
Budget Remaining After Completing Goals Needs Reassigning
After completing our goals before year-end, we shouldn't be prodigal like governments and find creative ways to waste the budget remaining. When we achieve the target (or goals), we don't spend funds over-estimated. We don't know the future, so it is reasonable we did not budget correctly. "Return funds" to the "central pool" for optimization in the organization. Conversely, when we under-estimate, we need to re-examine our goals, and as needed, request extra funds or change the goals to stay within the budget.
One reason governments waste our tax dollars is they focus on money alone-the size of budgets-instead of goals and programs, and the best ways to do them. Another reason is they get away with this practice, and we expect governments to be profligate and inept.
When doing the budget, we must select the best path to the goal as weidentify potential gaps and opportunitiesthat might arise during the budget period. This approach is obvious, but many folks don't do it. Either they don't prepare a budget, or they budget after they start their journeys. Alternatively, they focus on money independent of their goals. Thoughtful budgeting before the event allows us to examine alternatives to show likely paths to handle potential gaps and opportunities.
