Budgeting hints from the Internet

Citation

Maxymuk, J. (2000), "Budgeting hints from the Internet", The Bottom Line, Vol. 13 No. 4. https://doi.org/10.1108/bl.2000.17013dag.001

Budgeting hints from the Internet

Budgeting hints from the Internet

Keywords Financial management, Financial statements, Internet

Budgeting is a process everyone is familiar with in their lives. It is the process that has profound effects on how we are able to do our jobs and a process essential in the management of any enterprise involving money. For something so prevalent, however, budgeting can be positively devilish to do right. Drawing up a budget entails documenting how you intend to spend your money to reach your objectives. The document must be sturdy enough to cover all the basics of your operation, yet flexible enough to deal with sudden problems or shifts of emphasis. Is the staff large enough to fulfill your goals? Do they have the supplies and training they need? Are enough funds earmarked to grow with technological advances? An endless array of questions are provoked by the budgeting process. The Web does not offer an overwhelming mass of information on library budgeting, but there are a varied group of sites that can prove helpful.

An overview

The most detailed sites on the Web devoted to budgeting tend to be concerned with government units and agencies. However, these sites are useful to library managers. Frequently, the basis of the information provided is transferable to a library setting with minor alterations. One example of this is the International Budget Project (http://www.internationalbudget.org/), which is part of the Center on Budget and Policy Priorities (http://www.cbpp.org/). CBPP is a "nonpartisan research organization and policy institute that conducts research and analysis on a range of government policies and programs," whereas the IBP "assists non-governmental organizations and researchers in analyzing and improving budget policies and decision-making processes." In meeting this mission, IBP posts a rich body of budgeting information on its site. One place to start is the IBP online library of reports and studies that is both searchable and arranged by topic. Under "Budget process," you can find Mission Driven, Results-Oriented Budgeting, a report from the National Performance Review, examining ways to improve the budgeting process by making it more focussed on attaining specific results. In the same section, you also can find The Budget Preparation Process and Managing and Monitoring Budget Implementation both by Salvatore Schiavo-Campo and Daniel Tommasi of the Asian Development Bank. While these and many other interesting studies available on this site are focussed on national government budgets, much insight can be gained that can be transferred to any budget process. IBP also has prepared a Guide to Budget Work that is notable in this context mostly for its appendix. In the appendix, there is a section on budget stages and also a glossary of budgeting terms. Both of these are highly transferable.

Another budget-related output of the National Performance Review mentioned above is BudgetNet (http://www.financenet.gov/budget.htm), which is a resource for professionals interested in the economic, financial, and managerial issues of governmental budgeting. It is hosted by FinanceNet ( http://www.financenet.gov/financenet/start/whatis.htm), a sister network that provides Internet access to current and archival electronic reference libraries of financial and administrative information in addition to a clearinghouse for information on the sale of public assets and surplus that any government will be offering for sale to the general public electronically.

BudgetNet features a section on "Tools" that includes links to information on the technique of "benchmarking," the Department of Energy's Budget Formulation Handbook, and the Department of Commerce's Budget and Program Analysis Handbook. Another section is devoted to "Managing for results," a method advocated by the National Performance Review. A related section is on "Performance budgeting," which is a budgeting method that has been around for about 50 years. In short, performance budgeting aims to balance financial allotments with expected performance outcomes in a structured manner. Furthermore, the Resources section on BudgetNet offers performance measures, evaluation studies, forms, and instructions. As a part of this, you can find actual budgets for federal and state government entities accessible as well.

Some basic accounting information can be found on the Non-Profit Resource Center site (http://www.1800net.com/nprc/), which provides drop-down menus that link to industry-specific pronouncements from such accounting and governmental groups as the Financial Accounting Standards Board, the American Institute of Certified Public Accountants, the Government Accounting Office, and the Office of Management and Budget. For example, under Educational and Non-Profit Organizations, easy access is provided to OMB Circulars on "Cost principles for educational institutions" and "Uniform administrative requirements for grants and other agreements with institutions of higher education, hospitals, and other nonprofit organizations."

The Municipal Research & Services Center has posted an extensive bibliography of its holdings on local government budgeting on its site (http://www.mrsc.org/finance/budgets/budgetbb.htm). Although these again are related to government budgets and many of them are particular to Washington state, it is still worth checking out.

As an amusing, but interesting break from this serious study, try the National Budget Simulation (http://socrates.berkeley.edu:3333/budget/budget.html) put up by the Center for Community Economic Research at UC Berkeley. This simulated Web exercise enables you to cut the 1995 fiscal deficit of the US federal budget to achieve a balanced budget. After the power rush of setting the federal budget house in order, balancing your institution's books should seem simple.

Planning stages

All budgets have one thing in common and that is thorough planning is their key to success. At the American Library Association's 1999 annual conference in New Orleans, the University Libraries Section of the Association of College and Research Libraries (ACRL) sponsored a program called "Bottom line leadership: communicating your resources needs for successful service." The three Power Point presentations from this program were prepared by David Szeszycki, Assistant Provost, University of Iowa; Betsy Wilson, Associate Director of Libraries for Research and Instructional Services, University of Washington; and Stephen Coffman, Director, Research Services, County of Los Angeles Public Library and are on the Web (http://www.ala.org/acrl/uls/uls_conf99.htm). Overall, these presentations cover strategies to consider when making a funding case to university administrators, what "best practices" exist to communicate resource needs to funding officials, and how to determine service costs and demonstrate the meeting of customer service needs.

ACRL also includes pages on Standards and Guidelines for Colleges and Universities (http://www.ala.org/acrl/guides/index.html). A series of questions for the library administrator to consider when working on a budget are:

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  Are the library's annual authorized expenditures adequate to meet the ongoing, appropriate needs of the library?

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  How is the college's curriculum taken into account when formulating the library's budget?

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  Does the budget support an appropriate level of staffing and compensation?

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  Does the library budget reflect the library's responsibility for acquiring, processing, servicing, and providing access to media and computer resources?

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  How does the library monitor encumbrances and payment of its invoices?

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  Does the budget include adequate support for extended campus programs?

In today's increasingly electronic environment, technology is such a major part of any budget that a library may want to make a separate technology plan. The New Jersey State Library has developed instructions for developing a technology plan, in particular for public libraries, but it has relevance for any type of library (http://www2.njstatelib.org/njlib/techplan.htm). From a funding perspective, the New Jersey plan attempts to codify integrating technology into library services, acquiring and installing hardware and software, implementing staff and public user training, anticipating future upgrade expenses, and evaluating the effectiveness of the overall program.

Library specific budgeting examples

The State of Indiana has clarified its process even further with a printed Library Budget Manual that they also loaded on to the Web (http://test.ai.org/taxcomm/html/officials/manuals/budget/). While much of this is specific to the budgeting process for public libraries in Indiana, a great deal of it is universal. There are chapters on the purpose of budgeting, budgetary principals and definitions, each of which are especially useful for any library manager engaged in budgeting. Such concepts as how budgets reflect the goals of the users, how the budget relates to the development and administration of policy and why the budget is the most important managerial tool available are all developed here. Even Indiana-specific forms and terminology can be useful to look over in comparison to local equivalents.

Likewise, the Health Sciences Library of the University of Virginia has a page devoted to its budget (http://www.med.virginia.edu/hs-library/admin/plan.html). While few specifics from the budget are given, it is interesting to note that major emphasis is given to the Library Workplan (http://www.med.virginia.edu/hs-library/admin/work9901.html) that outlines the goals of the institution. Both the library's budget and faculty/staff annual performance plans are closely related to this workplan document.

The University of Illinois at Urbana-Champaign's actual budgets for Fiscal Years 2000 and 2001 are posted online (http://www.library.uiuc.edu/PlanningBudget/budget.htm) with full details. These budgets are also tied closely to the library's Strategic Plan (http://www.library.uiuc.edu/PlanningBudget/files/NewPlan2.pdf) and it is interesting to see how service aspirations are addressed by financial reality.

Conclusions

A library's budget is clearly a planning document itself and is not created in a vacuum, but in conjunction with other planning documents. All such documents are constructed according to established priorities and policies delineating competing interests and within the often-exacting time frame of a local calendar. As we have seen, the Web can provide some background and direction in this regard.

Comments on this column are welcome and can be sent to maxymuk@crab.rutgers.edu. Or visit my Web page (http://www.rci.rutgers.edu/~maxymuk/home/home.html). Links to Web sites referred to in this column can be found there.

John MaxymukReference Librarian at the Paul Robeson Library, Rutgers University, Camden, NJ, USA