Wayne State University

Aim Higher

Policies-11

1.2.1.1 Budget Development

DESCRIPTION

The following procedure describes the general flow for developing a General Fund budget. Auxiliary Fund budgets are initiated when the budgetary unit submits an estimate of revenue and expenditures to the University Budget Office. When developing a General Fund budget it is important to understand the difference between Base and Operating Budgets. These are explained in the definition section of this procedure. The instructions distributed with the forms should be used when developing a General Fund budget.

POLICY

The University expects that each manager will operate within the approved Operating Budget. Commitments cannot be made that result in a deficit in any account, whether General or Auxiliary Fund.

DEFINITION(S)

Base Budget

The total dollars, exclusive of the current year's compensation increase, one-time only funding, prior year encumbrances and carry forward available for the unit's basic, ongoing programs.

Operating Budget

The Base Budget adjusted by items, which are in effect for the current year only. Most of these non- recurring items are listed below; generally, unless a budget change is clearly and officially indicated as a Base Budget change, it is not.

Internal Billing (Applicable to Internal Service Department only)

A reasonable estimate of billing to be made to other University accounts on the Internal Requisition and Inter-Account Bill, form 108, may be added to the Base Budget during the budget distribution procedure, using the Departmental Revenue worksheet. Actual billings in excess of this estimate can be used to increase the Operating Budget; actual billings less than this estimate will reduce the Operating Budget.

Internal Service Department Balances and Deficits

Some internal service departments operate in the General Fund in a revolving fund manner. Their revenues and expenditures adjust their accumulative balance or deficit at the close of a fiscal year and determine the amount to be carried over into the new fiscal year.

 

Other Adjustments

Non-recurring transfers from the Reserve for contingencies and compensation adjustments that expire with a specific contract, such as merit bonus payments which are not a part of the base salary, are not considered part of the base budget.

PROCEDURE

Responsibility

Action

 

University Budget Office

  1. Prepare budget planning packages which include all necessary forms and instructions to submit data for the upcoming fiscal year.

  2. Distribute package to Vice President of each major division.

Vice President

Distribute package to Deans/Directors and Assistant Vice Presidents.

Dean/Director/ Assistant Vice President

Review package.

 

Distribute budget package to each major unit, which has one or more board lines.

Budgetary Unit

Complete required budget forms following instructions in package.

 

Submit budget forms to Dean/Director or Vice President.

Dean/Director/ Assistant Vice President

 

Submit forms to Vice President.

Vice President

Forward forms to University Budget Office.

University Budget Office

 

Review budget forms.

 

Prepare Annual General Fund Budget and obtain approval from Board of Governors.