Budget Process Procedure

Procedure:  
The following is an outline of the budget process: 
  
Base Budget Template from Finance to Budget Directors              Target Due – Mid February
The Office of Finance is responsible for providing base budget templates to all budget directors (executives and directors with budget authority).  The base budget template includes the following: 

• Staffing Pattern – A line item detail of current staff and contractual agreements based on current salary rates and benefits.  The staffing pattern includes all consultants, whether via purchased services, accounting & legal, public relations, computer services or similar services. 
  • New staff requests and reclassifications are to be submitted to HR in November 
• Professional Development – A line item detail by employee based on contractual agreements and/or university policy. This amount is subject to overall approval and/or adjustment based on overall budgetary constraints.
• Other Budget Detail – A line item detail for other expenses will be based on the previous year for the base budget. Any changes to these expenses will be provided by the budget directors and will be reviewed for approval.  

The overall focus with the budget directors is to focus on expenses he/she has control over. For example, budget directors have minimal control over utilities or similar infrastructure accounts, but he/she may have substantial control over staffing or setting policies that drive the expenditures, such as what student expense items will be paid by the university. 
  
Budget Director Review Target Due – February 
Budget Directors are responsible for the following: 

• A line item review of the base budget template, with corrections if any 
• Input as to changes from one year to the next, including significant vendor price increases, increased usage, etc. 
• Proposed new programs, staffing or other expenses summarized with the appropriate supporting documents (see below). 
  • Internal Proposal – All new requests for programs or services > $10,000 must include a completed Internal Proposal. 
  • Pre-Approval Cover Sheet –Requests for new staff proposals (non-replacement. 
  • Capital Equipment Request:  Equipment requests > $5,000 and a useful life of > one year must include a completed Capital Equipment Request. 

Budget Work and Budget Director Meetings Target Due – March 

Base budgets are received back from budget directors. Finance enters changes for overall budget draft review. Meetings are held at this time for additional clarification on budget changes with budget directors. 
  
Finance Consolidates Budget for Review by the President, CFO and Provost  Target Due – Mid March 

• The budget collaborative team will review the overall budget for the university and individual Colleges to ensure the budget: 
  • Aligns with the university mission, core themes and initiatives 
  • Is in accordance with existing policies and procedures and 
  • Is sustainable financially. 

The team presents recommendations for new programs, proposals, cuts, or re-allocations. Additional supporting documentation is requested regarding proposals or missing information, such as bids for Capital Equipment Requests, an Internal Proposal, or other comparisons. The pros and cons of the various options are summarized and supported by applicable documents. 
  
President’s Advisory Council (PAC) Budget Meeting                                     Target Due – April 

An overview of the draft budget will be presented to the PAC. This comprises of discussions of what the budget entails and if budget cuts are needed. 

Budget Directors receive a list of approved budget changes 

Finance Committee April Meeting 
Provides input and approves or disapproves with action items. 

• Executive Team and / or individual Budget Director responds to action item. 
• Finance Committee approves and recommends to full board 

Board approves final Budget by the April Board Meeting 
  
Final Budget is implemented by June 30 

Other Budget Policies and Procedures: 
  
Budget Director Authority 

Budget directors have the authority to shift funds from one line to another as long as certain criteria are met: 

1. The shift is consistent with College and University policies and procedures. 
2. The overall department budget is the same or less. 
3. Directors are encouraged to share budgets and collaborate with other budget directors when overlap exists. 
4. Any change affecting other departments must be approved prior to the change. 
   • For example, any implementation of software requires IT approval. Having the money for software in your budget does not ensure IT has the necessary resources to implement and support it.  
   • Any change affecting facilities or security must be approved by the applicable budget director. 

 Budget Changes 

• Proposals to reclassify expenses within College or University policies do not require the approval of the Board of Trustees’ Finance Committee unless the dollar amount of the change is greater than $100,000 and causes the University to be over budget in total by greater than $100,000, or is a substantive change to the original budget (i.e. new program).  
• Consideration must be given to the impact on cash flows. 

 Procedures for Budget Directors to Submit a Mid-year Budget Change 

• The budget director must complete a Budget Change Form along with the applicable support (see the Internal Proposal template), including but not limited to the following: 
• Pre-Approval Cover Sheet 
• Capital Equipment Request 

Substantive changes, such as the addition of a new program, must be supported by a complete Internal Proposal, addressing issues such as a needs assessment, personnel requirements, finances, space, timing, accreditation, and support needed by other departments. 

Appendices: 

N/A 

Policy Resources

• Policy Development and Approval Training
• Establishing and Creating University Policies and Procedures (Policy)
• Policy Development & Approval Procedure
• Policy Development & Approval Diagram
• Policy Justification Form
• Policy Template (password protected)
• Procedure Resources (password protected)
• PNWU Alumni Association Bylaws
• COM Bylaws
• PNWU Bylaws

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For assistance with policies and procedures contact:

Lori Fulton
lfulton@pnwu.edu