The University's Budget Cycle (A User Guide)

Introduction

Budgets are allocated to:

•  Income and expenditure nominals within Agresso. Accurate allocation to income and expenditure nominals is critical. It is important not to leave large amounts in contingencies.

•  Schools, services, departments, divisions, cost centres, projects etc.

•  Periods (profiles) - Large amounts should not be left in period 12.

•  Revisions during the year

Reporting out of Agresso:

•  On-line enquiries

•  Excelerator reports. (Provided monthly by Financial Services but can be produced at any time on request)

Budget Cycle

The annual budget cycle runs from 1 August to 31 July:

•  Initial budget (Base) - Agreed at Senate in early July. Put onto Agresso in late July for budget holders to allocate during August

•  The first revision - Mid-year financial review - February/March

•  The second revision - 5 year financial forecast submitted to HEFCE - May

•  The final revision is prepared in November and results in carry forward allocation to Schools and Services.

All the above are formal revisions but you should review income and expenditure on a continuous basis so that you are aware of any likely changes and can take appropriate action.

Reporting

Senior staff - Monthly Management Reports (Prepared by Financial Services and distributed to senior staff)

•  To report against the base budget (August to February)

•  To report against the mid-year revised budget (March to June)

•  To report against the financial forecast revised budget (July)

•  To reconcile each revised budget to the original budget

Budget holders (Prepared by Financial Services and e-mailed to budget holders shortly after each month end)

•  To report against the current budget only. Although budget holders may be asked to explain variances against Base/Mid-year for inclusion in monthly management reports for senior staff.

In order to report against differing 'versions' of the budget there are different 'amount types' for entering budgets in Agresso:

•  Base budget

•  Base budget - Virements

•  Mid-year budget

•  Mid-year - Virements

•  Financial forecast

•  Financial forecast - Virements

Why do we Need Accurate Budgets?

•  Helps you to plan for the coming months

•  Helps you to decide between competing activities

•  Ensures that 'informed' decisions are made

•  Enables you to recognise when your plans are going adrift during the year

•  Ensures that returns to the Funding Councils are accurate

•  Communicates our financial decisions to senior staff, council and committee members

•  Acts as 'one' performance measure (Benchmarking)

Good Practice

•  Reviewing budgets on a continuous basis

•  Allocating from contingency to the appropriate nominal

•  Accurate 'profiling' into the correct periods

•  Dedicating sufficient time to the task

•  Considering both past and future events

•  Accounting for both 'sides' of a transaction (Changes to income may result in a corresponding change to expenditure. Consideration should be given as to whether all changes have been taken into account)

•  Neither over-cautious nor over-optimistic (Showing projected income/expenditure that's likely to arise)

•  Consulting widely

•  Identifying all costs (e.g. On-costs on staffing)

•  Identify what will be spent/received rather than what should be

•  Attend training courses or seek out knowledge

Timetable for Budget Process

The timetable for the current budget cycle is set out below. However, please note that HEFCE are currently planning a revision to the reporting process which may affect the current timetable. Any changes will be published as more information becomes available.