BudgetingBudgeting

Budgeting allows you to plan what your group is going to deliver over the coming year and what is needed to cover the costs. Proper budgeting will help ensure that you don’t run out of money or face unexpected costs during the year ahead. It will also help you make financial decisions and keep control during the year on the financial spend and income.

There is nothing complicated about writing a budget. It’s like writing a shopping list, together with the cost of each item. You must then work out where you will get the money to pay for it all.

Here’s some tip to consider:

  • The budget needs to be realistic.
  • The budget needs to be monitored everyday operationally.
  • The budget needs to be monitored monthly/quarterly by the Trustees or Management Committee.
  • The budget needs to build in flexibility for unknowns that may arise.
  • The budget should help in making decisions about what to do and what not to do.

Consider the following items when putting together your budget:

Capital expenditure

Capital expenditure is the amount you need to spend on large items for example:

  • Office equipment, e.g. computer, photocopier, printer, telephone system.
  • Equipment for your activities, e.g. minibus, play equipment, furniture, catering equipment.
  • Equipment for your premises, e.g. burglar alarm, bins.
  • Works to improve your premises.

Revenue Expenditure

The revenue expenditure is the amount that is spent day to day. Typical items which would be classed as revenue expenditure could be for example:

  • Hire of a hall, if the hall is not part of your own premises.
  • Volunteer costs.
  • Training.
  • Materials, books and small items of equipment.
  • Publicity and leaflets.
  • Repair of equipment.

Administration costs

Administration costs might include:

  • Book-keeping.
  • The payroll service.
  • Postage.
  • Printing, photocopying & stationery.
  • Telephone & fax.
  • Internet costs.
  • Insurance.

The premises costs might include:

  • Rent & rates.
  • Water.
  • Heat and light.
  • Cleaning and rubbish collection.
  • Repairs and maintenance.

Staff costs might include:

  • Wages and Employer’s National Insurance.
  • Pension contributions by the group (if you employ staff).
  • Recruitment e.g. adverts, postage of application packs, etc.
  • Training.

Fundraising costs might include:

  • Hire of hall (for jumble sale, etc.).
  • Publicity and other costs.