Shenandoah University

Operating Budget Policy

Replacement of Procedure: Budget Procedure approved October 23, 1993

Proposed by: Comptroller

Approved by: President & Vice-President for Administration and Finance

Effective date: March 6, 2000

Amendment date(s):

GENERAL

The operating budget is a financial plan of current operations that encompasses both estimated revenues and estimated expenditures for one fiscal year. Every budgetary unit or department is assigned a budget officer who is normally the department chair or manager. All budget officers are recommended by the appropriate Vice-President for approval by the President and/or the Vice-President for Administration and Finance. Existing budget officers will serve until replaced by the action of the President and/or Vice-President for Administration and Finance. Budgets are monitored by the Comptroller who reports significant variances to the President and the Vice-President for Administration and Finance.

BUDGET PREPARATION PROCESS

The budget preparation process may be modified each year to reflect improvements in the process and/or circumstances relevant to the year. The process may be generally described as follows:

In October, budget worksheets for the new year are distributed to all budget officers by the Comptroller. The budget worksheet for the departmental budgets displays at least two years of historical data, the original budget for the current year, the current budget, and a request for anticipated budget requirements for the next fiscal year. Separate budget request forms are distributed with the departmental budget worksheets to request data on personnel, instructional equipment, furniture and office equipment, and computer technology needs since these expenditures are not allocated within each departmental budget.

During October and early November, the applicable Vice-President and Dean (if applicable) or President meet with each budget officer to discuss the requests. Budget officers prepare their budgets and forward the requests to the appropriate personnel for review and necessary modifications by mid-November. The appropriate personnel are defined as follows:

Type of Request ------------------------- Personnel Responsible

Departmental budget worksheets ----------- President or Vice-President to whom they report

Personnel requests for faculty positions --- Vice-President for Academic Programs

Personnel requests for staff positions ----- Vice-President for Administration and Finance

Instructional equipment requests ------------ Vice-President for Academic Programs

Furniture and office equipment requests ----Vice-President for Administration and Finance

Computer technology requests --------------- Vice-President for Administration and Finance

The Vice-President for Administration and Finance forwards copies of the furniture and office equipment requests to the Director of Physical Plant and Director of Auxiliary Services (if applicable) and copies of the computer technology requests to the Director of Institutional Computing for review. The requests are added to the capital budget request listing kept by each director. Once the budget for capital expenditures has been established by the President and the Vice-President for Administration and Finance, the items on the capital budget lists are prioritized for current year purchases.

The President estimates the anticipated revenues for the following budget year based upon data furnished by the Vice-President for Administration and Finance, Vice-President for Enrollment Management, and Director of Admissions. This includes estimating tuition and fees increases, room and board increases, endowment spending return, gifts and grants, etc. At this time, too, the percent increase for the compensation pool and reserve funding are discussed and added to the budget plan.

The President or applicable Vice-President delivers all budget requests to the Comptroller for data input in early December. By mid-December, the Comptroller distributes a budget summary worksheet and a detailed report of all requests to the President and Vice-Presidents to review and make any necessary modifications. The President and Vice-Presidents set criteria for the use of new resources by identifying goals or needs. They review the proposed budget with particular attention to capital and new position requests. Any changes are given to the Comptroller for data entry.

During the January meeting of the Administration and Finance Committee, the President and the Vice-President for Administration and Finance present an operating budget based upon the estimated revenues and requested expenditures for recommendation to the Board of Trustees.

The recommended budget is presented to the Board of Trustees for approval at its regular meeting in April. After the approval of the board is obtained and by May 1st, the Comptroller distributes the approved budget for the new fiscal year to all budget officers.

BUDGET CHANGES

The operating budget may need changed due to changes in revenues, release of reserves or increases in expenditures. The Vice-President for Administration and Finance, at the President’s discretion, will make amendments within the framework of available funds for academic programs and supporting activities. The other Vice-Presidents will be given the opportunity to participate in developing revisions in their area of responsibility. Revisions are given to the Comptroller for data entry.

Budget increases or decreases to departmental budgets require the approval of both the department’s Vice-President or President (if applicable) and the Vice-President for Administration and Finance. All budget revisions are sent to the Comptroller with the following information:

• Account number to be increased or decreased
• Amount to be increased or decreased
• Purpose of the increase or decrease
• Approval of the budget officer
• Approval of the appropriate Vice-President(s) or President

Budget change transaction reports are distributed monthly to budget officers by the Comptroller.

The revised budget is presented at each meeting of the Board of Trustees Administration and Finance Committee for recommendation to the full Board of Trustees. The recommended revised budget is presented to the Board of Trustees for approval at its regular meetings in April and October.

BUDGET TRANSFERS

Budget transfers move budgeted funds from one account to another either within a department or between various departments. Available budget funds from vacant faculty or staff positions cannot be used to increase departmental budgets unless approved by the President and/or the Vice-President for Administration and Finance . Federal College Work Study funds may not be transferred without the approval of the Vice-President for Administration and Finance.

A budget transfer may be initiated by submitting a memo for transfers between departments or completing a Request for Reallocation of Budgets for Expense Object Codes form for transfers within the same department to the Comptroller stating the following:

• Amount to be transferred
• Account(s) to be decreased
• Account(s) to be increased
• Purpose of the transfer
• Budget officer approval

The Comptroller will make the budget transfer and obtain approval of the adjustment from the Vice-President for Administration and Finance. These transfers are displayed on the budget change transaction reports that are distributed monthly to budget officers by the Comptroller.

These transfers are included in the revised budget that is presented at each meeting of the Board of Trustees Administration and Finance Committee for recommendation to the full Board of Trustees. The recommended revised budget is presented to the Board of Trustees for approval at its regular meetings in April and October.

DESIGNATED FUNDING REQUESTS

Expenditure budgets that were not spent in the prior fiscal year will only be considered for re-establishment in the current fiscal year if recommended for approval by the budget officer and the respective Vice-President. Requests may be approved based on the following conditions:

• There are sufficient available resources to support the request
• The expenditure budget was not spent as a result of a delay in the planned activity that the budget was intended to support, or the goods or services were ordered but not delivered
• The activity supported by the expenditure budget is critical to the operation of the department and the fulfillment of its mission
• A reasonable attempt was made by the requesting department to expend the budget before the close of the prior fiscal year
• The department requesting the increase had at least the same amount of budget remaining at the close of the prior fiscal year and had taken steps to correct all over-expenditures in all other areas under their supervision

All requests must be made in writing to illustrate that the above conditions are been met and submitted to the Comptroller by mid-July. The Comptroller will review the requests with the President and the Vice-President for Administration and Finance. All requests approved by the President and Vice-President for Administration and Finance are submitted to the Board of Trustees Administration and Finance Committee for recommendation to the full Board of Trustees for approval at the October meeting. After approval of the board is obtained, the Comptroller will enter the budgets into the budget plan for the current year. These designations will be displayed on the November budget change transaction reports that are distributed to budget officers by the Comptroller.

Exhibit: Faculty Personnel, Staff Personnel, Furniture, Office Equipment, Instructional Equipment, Major Renovation Projects, and Computer Technology Request Forms

Exhibit: Request for Reallocation of Budgets for Expense Object Codes

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