Overview. Presentation ObjectiveWhat is Budgeting?Why Budgeting?Why in the manner PRP budgets?How to budget on PRP?Tools for use in budgetingThe PRP budgeting template. Presentation Objective. Providing training on new PRP budget templates.. What is budgeting?. A budget is a list of all planne
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1. Call for Proposals PRP Phase II
Activity Based Budgeting
2. Overview Presentation Objective
What is Budgeting?
Why in the manner PRP budgets?
How to budget on PRP?
Tools for use in budgeting
The PRP budgeting template
3. Presentation Objective Providing training on new PRP budget templates.
4. What is budgeting? A budget is a list of all planned expenses and revenues. It is a plan for saving and spending. A budget is an important concept in microeconomics, which uses a budget line to illustrate the trade-offs between two or more goods. In other terms, a budget is an organizational plan stated in monetary terms. In summary, the purpose of budgeting is to:
Provide a forecast of revenues and expenditures i.e. construct a model of how our business might perform financially speaking if certain strategies, events and plans are carried out.
Enable the actual financial operation of the business to be measured against the forecast.
5. Why Budgeting? During budget preparation, trade-offs and prioritization among program components must be made to ensure that the budget fits the Programme policies and priorities. Next, the most cost-effective variants must be selected. Finally, means of increasing operational efficiency in PRP must be sought. None of these can be accomplished unless financial constraints are built into the process from the very start. Accordingly, the budget formulation process has to address operational efficiency and performance issues. Specifically;
Budgeting provides the yardstick against which future results can be compared;
with the establishment of the budget, action(s) can be taken by management if there are any material variances against budget;
Budgets enable management to plan and anticipate in areas of adequacy in working capital and scarce or type of availability of resources;
Assist to plan and control receipts and expenditure so that maximum results can be achieved;
Budgets act as a guide for management decisions when unforeseeable conditions affect the budget;
Assist in decentralizing responsibility on to each manager involved. With the setting of budgets, the managers involved will better understand what the organisation expects from them. Therefore there is a congruence of goals between the organisation and the employees.
6. Why in the manner PRP budgets?
Creates value by translating the project strategy into the activities necessary to implement that strategy
Assessing the relationship between activities and their impact to overall goal
Comparing cost drivers for different activities, therefore more cost effective strategies
Capacity management between different cost drivers/ activities
Better analysis of expenditures (how are expenditures relevant for the project goal)
Why Budgeting? (continued)
7. How to budget on PRP? Tools for use in budgeting
Prior implementation experience
8. The PRP budgeting template
ANNEX VI - APPLICANTS BUDGET.xls How to budget on PRP? (Continued)
I thank you!!!