Budget Development
Definition of “Budget”: a detailed statement outlining estimated project costs to support the sponsored project. A budget should include all the Direct Costs and Facilities and Administrative (F&A) (or overhead) costs required to carry out the project objectives. Proposal budgets in Kuali Coeus should match the level of detail submitted to the sponsor. Specific requirements, including cost principles as defined by the federal government in the Office of Management & Budget (OMB) Circular A-21and OMB’s Uniform Guidance, must be adhered to at the proposal stage and when the funds are expended. Proposals to non-federal sponsors requesting approval of direct costs which are unallowable for federal reimbursement should clearly include and justify those costs in the budget.
• Direct Costs – Expenses that are specifically associated with a particu¬lar sponsored project or activity and/or can be directly assigned to that project or activity with a high degree of accuracy for example graduate student stipend and tuition.
• F&A Costs – Institute expenses that cannot be specifically identified with a particular project or activity.
Examples of Development Budget in a sentence
1. All expenses shall be charged to the proper Budget Category in the Development Budget, and no expenses may be classified or reclassified for the purpose of avoiding an excess in the budgeted amount of a Budget Category without Owner's prior written approval.
2. If, notwithstanding Targacepts exercise of Commercially Reasonable Efforts, in any year, the aggregate FTE Cost plus the External Targacept R&D Costs [********] FTE Costs and External Targacept R&D Costs in the applicable Targacept Research Budget (and the Total Research Budget), ARP Budget or Targacept Development Budget (as the case may be) [********] in accordance with the applicable Annual Research Plan, Additional Research Plan or Product Development Plan [********].
3. As used in this Section 16, each of the following terms has the meaning for that term provided in the Project Administration Agreement: "Architect"; "Architect's Contract"; "Commencement of Construction"; "Construction Schedule"; "Final Construction Schedule"; "Final Development Budget"; "General Contract"; "General Contractor"; and "Project".
What Is a Revenue Budget?
Revenue budgets are forecasts of a company’s sales revenues and expenditures, including capital-related expenditures. It is essential that you establish whether you possess enough financial means to conduct operations, grow your business and ultimately make a profit. Without this planning, your company's future may be uncertain as you may not know how much money you’re taking in or spending. Revenue budgets ensure that businesses efficiently allocate resources -- and in doing so they save time, effort and money.
Determine Sales
The revenue budget helps businesses predict the amount they will earn when they sell their products and services. At times, this can be difficult for small businesses to calculate, especially for those that have just started -- and therefore have no historical data. You must formulate a business plan and maintain it. Business plans reflect the true state of an organization’s current business and help to analyze every aspect the business, including expected revenues. The sales revenue budget can be straightforward to construct. It includes the number of units you expect to sell, along with the number of customers that you expect will buy your products or services. It also includes the price you will charge for those products and services.
Determine Production Costs
The next step in the process is to form a production budget; this summarizes the costs associated to the production of your goods or services. You must include the cost of labor, material and purchases. Materials are the raw material or other items that your use when you produce your goods and services. The rate that the cost of raw materials fluctuates depends on the market in which you operate; therefore, you must keep a close eye on price fluctuations when you formulate your production budget. You pay salaries, unemployment taxes and other benefits for employees who produce your goods and services; these make up your labor costs.
Daily Expenditures
General and administrative budgets track the non-production costs associated with your business’ daily operations. These costs include rent expense, insurance and asset depreciation. Costs associated with staff members such as sales staff, clerks and other support staff that don’t directly affect the production of your goods and services come under the heading of general and administrative expense. You must calculate your depreciation costs so that you do not overrate your assets.
Investing Within Your Means
Capital expenditure budgets calculate costs associated with the investments that you plan to make during the year. Capital investments include buildings, machinery and other equipment that you use to increase or expand your business. You make capital purchases to replace older equipment or add new equipment to meet the demands of your business. Once you determine the equipment that you must purchase in the current year, you can compute the costs associated with your equipment.
Budget vs. Performance
Once you have successfully constructed a revenue budget you can compare it with your actual performance. This analysis can help you determine if you should continue your current practices or take corrective measures. If your business performed as expected or better, you may determine that current practices are adequate -- but if your company fails to meet expected goals, it may be necessary to adjust your practices. You can incorporate your finalized revenue budget with financial performance analyses and scrutinize the growth of your business.
The revenue budget consists of revenue receipts of the government (revenues from tax and other sources), and its expenditure.
Revenue receipts are divided into tax and non-tax revenue. Tax revenues are made up of taxes such as income tax, corporate tax, excise, customs and other duties that the government levies.
In non-tax revenue, the government's sources are interest on loans and dividend on investments like PSUs, fees, and other receipts for services that it renders. Revenue expenditure is the payment incurred for the normal day-to-day running of government departments and various services that it offers to its citizens.
The government also has other expenditure like servicing interest on its borrowings, subsidies, etc.
Usually, expenditure that does not result in the creation of assets, and grants given to state governments and other parties are revenue expenditures. The difference between revenue receipts and revenue expenditure is usually negative. This means that the government spends more than it earns. This difference is called the revenue deficit.
