Presentation on theme: "MBA for Librarian Series Budget and finance. Presented by American Library Association – Allied Professional Association (ALA-APA) John Sandstrom – MLS,"— Presentation transcript:
Presented by American Library Association – Allied Professional Association (ALA-APA) John Sandstrom – MLS, University of Oklahoma, 1987 – MPA, University of Texas – El Paso, 2010 – Assistant Profession, College Faculty and Acquisitions Librarian, New Mexico State University
What are we here for? To share 25 years experience as a budget officer for various types of libraries and projects To share various terminology, tips, tricks, and techniques of budget and finance processes. To share your questions and knowledge with the rest of the group
Disclamer As nice as it would be, attendance at this presentation does not result in any credit towards a Masters of Business Administration The material presented today represents my experience over the past 24 years. Every organization has its own budgeting policies and procedures. In every case, if you have questions they are the authoritative source of answers
Tip #1 Don’t be afraid to ask questions! Most budget managers are glad to explain how things work in your organization. The more you know, the easier their job is.
What is Budget and Finance? A budget is a plan for the coordination of resources and expenditures Finance is the science or study of the management of funds – From the Mirriam-Webster Dictionary Online (www.meriam-webster.com/dictionary)
Tip #2 Ask for training. Many organizations have Tuition assistance or staff training and development programs the can be used for more formal training regarding budgeting and finance. They may also offer training in how they do budgets.
Methods of budgeting Lump Sum Line item Program Performance/Function Zero-based
Tip #3 Try a different type of budget method. Even if you don’t use Program or Performance/Function budgeting methods, they can be useful tools to determine the cost/benefit of various programs.
Types of Budgets Operating – Personnel – Materials – Overhead – Building Capital – Construction – Collection
Tip #4 Ask Ask Ask If you don’t understand what is being charged to a particular budget, ask until you do.
Types of Revenue General Fund Endowment Grant Private Gift Bond Capital
Tip #5 Check the rules. Some types of revenue have different rules for how they can be allocated, tracked, etc. Make sure you check how the funds can be spent and if there are any “strings” attached.
Types of Expenses Ongoing or reoccurring – Personnel – Serials – Building overhead One time – Books – Capital – Fleet
Tip #6 Check the rules again! The rules of your organization may change by what type of expense you are working with. Make sure to ask.
Building a Budget Find out what was done last year. Find out what the assumptions are for next year Review ancillary documents like strategic plans, mission statements, and goals and objectives.
Tip #7 Have clear institutional goals. Without knowing where you want to go, it is hard to get there and harder to justify the expense.
Building a Budget (cont.) Be Flexible Be pragmatic Double check all the figures Get someone else to check them again
Tip #8 Leave yourself some wiggle room While budgeting to the penny is admired in some quarters, it is always good to budget in a cushion to allow for unexpected circumstances
Cutting the budget – Part 1 As part of building the budget – Review strategic plan and mission statements – Get a hard figure for how much needs to be cut – Find out what areas, if any, are protected – Look at impacts
Tip #9 Remember the benefits multiplier when looking at personnel costs For every personnel line there are two costs, the salary/wage and the benefits. Cost of benefits is usually a percentage of budgeted salary or wage. Make sure to remember the multiplier when you figure salary savings.
Cutting budgets – Part 2 Mid-Year cuts – Much harder than planned cuts – First question is always, “Where is there money left?” – Ask what is or isn’t on the table – Balance low impact vs high impact cuts
Tip 10 Ask about the politics. When cutting budgets the politics can be critical.
Summary The 10 Tips – Don’t be afraid to ask questions! – Ask for training. – Try a different type of budget method. – Ask Ask Ask – Check the rules. – Check the rules again! – Have clear institutional goals. – Leave yourself some wiggle room – Remember the benefits multiplier when looking at personnel costs – Ask about the politics.