Transcript How To Read Your Financial Statements

Understanding Your
Budget
Presented by
San Francisco State University
Auxiliary Business Services
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Budget Overview
• Why have a budget?
• Where the money comes from
• Where the money goes
• Calendar
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Why have a Budget?
The budget is a management tool
• Internal planning
• External notification of activity
 Campus President
 Bond Holders
 CSU Trustees
• Long-term debt repayment
• Project future needs
 Fee Referendum
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Budget
Planning
The annual budget is about planning
• Prescribes activity based on current and
future needs
• It may draw upon reserves from prior
periods or contribute to reserves for future
periods
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Budget
Notification
• Gives notice to campus community of goals and
overall direction
• Shows trends in earnings and spending
• Demonstrates (or disproves) capacity to
assume debt
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Budget
Long-Term Debt Management
• Debt repayment costs
• Annual escalation factors
 Program Revenue
 Cost of Living Increases
 Capital Replacement
• “What if” scenarios for early retirement of
debt
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Budget
Fee Referendum Planning
• Anticipate future deficits
• Project exhaustion of reserves
• Determine amount of increase needed and
how long it will last
• Provides lead time (2-3 years) to present
Referendum to campus
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Sources of Funds
• Student Fee Revenue
• Program Revenue (earned income)
• Grants & Contracts
• Draws from Reserves
• Undesignated Net Assets from Prior Years
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Source of Funds
Student Fees
•
•
•
•
•
Collected by university
Largest revenue source
Relatively constant (doesn’t escalate)
Per “head count” of student enrollment
Less:
• Fee waivers
• Refunds
• Debt service costs (SC only)
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Where the money goes
Use of Funds
• Personnel costs
• Operating Expenses
• Donations
• Organizations & Graduations
• Scholarships
• Capital Equipment
• Additions to Reserves
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Use of Funds
Personnel
• Largest corporate cost segment
• Highest annual escalation
• Legally binding
 Labor Laws
 Federal and State regulations
- IRS, EDD, INS, SSA, etc.
 Treaties
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Use of Funds
Capital Equipment
• Replacement of costly items
 Heavy machinery or equipment
 Major building repairs
• Irregular cost intervals
• Cost Escalation
• Job bidding (where applicable)
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Budget Calendar - ASI
• Mid-Year Budget Adjustments
 January create & review drafts
 ASI Board approves
 Budget Review
• The adjusted budget serves as a model for the
annual budget.
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Budget Calendar – ASI
• Annual Budget
– Feb/Mar create & review drafts
• Interview program directors
– April
• ABS creates long-range forecasts
• ASI reviews
• Budget document assembled/printed
– May 1 submission deadline:
• ASI Board approval
• Budget Review approval
• submit to VP for Business & Finance
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The End
Thank you!
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