RHODES UNIVERSITYBUDGET 2014

LAUNCH

PRESENTATION TO BUDGET COMMITTEE29 July 2013

Developed and presented by Geoff ErasmusManagement Accountant

BUDGET2014

CONTENT

Purpose of Budget Launch

Budget Process Framework Key Elements Strategy Budget Information System Budget Principles Budget Process Steps Budget Cycle/Timeline

Budget 2014 Key Parameters Budget Templates Budget Submissions Time-table

Questions

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PURPOSE OF BUDGET LAUNCH

Get everyone on board

Present the process

Introduce and explain new aspects

Clarify uncertainties

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CONTENT

Purpose of Budget Launch

Budget Process Framework Key Elements Strategy Budget Information System Budget Principles Budget Process Steps Budget Cycle/Timeline

Budget 2013 Key Parameters Budget Templates Budget Submissions Time-table

Questions

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INFORMATION SYSTEMDesigned to link and support all the

elements of the budget.

PurposeThe purpose and objectives of the budget is understood by all

Principal Budget Factor Early identification of the appropriate factor to prevent delays

Co-ordinationInter-relationships are managed and all stakeholders involved

ParticipationBudget holders participate in setting their own budgets

KEY ELEMENTS FOR A GOOD BUDGET

InformationAdequate information made available to those involved in the process

Inter-relationships Inter-relationship of budgets are understood and managed in relation to the principal budget factor

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PURPOSEPURPOSE

Purpose expressed in the Institutional Planning & Review Framework

Communicated to stakeholders through the budget manual

Purpose expressed in the Institutional Planning & Review Framework

Communicated to stakeholders through the budget manual

CO-ORDINATIONCO-ORDINATION

Stakeholder matrix developed

Budget launch on 29 July 2013

Timetable agreed with relevant stakeholders

Stakeholder matrix developed

Budget launch on 29 July 2013

Timetable agreed with relevant stakeholders

PARTICIPATIONPARTICIPATION

Three Budget Committee meetings

Academic budget requests to Deans’ Forum

Training for budget developers

HOD’s sign-off

Three Budget Committee meetings

Academic budget requests to Deans’ Forum

Training for budget developers

HOD’s sign-off

BUDGET STRATEGY

INFORMATIONINFORMATION

Budget manual available on the Finance Divisions website

Templates include historical budget and actual expenditure information

Budget manual available on the Finance Divisions website

Templates include historical budget and actual expenditure information

PRINCIPLE BUDGET FACTOR

PRINCIPLE BUDGET FACTOR

Subsidy grant determined to be the principal budget factor

Subsequent budgets to be developed

Subsidy grant determined to be the principal budget factor

Subsequent budgets to be developed

INTER-RELATIONSHIPSINTER-RELATIONSHIPS

Budget matrix developed Budgets scheduled

according to the relationships

Budget matrix developed Budgets scheduled

according to the relationships

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BUDGET INFORMATION SYSTEM

SPEEDFLEXIBILITY

INTELLIGENCE EFFECTIVENESS & EFFICIENCY

What to expect from an information

system

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BUDGET INFORMATION SYSTEM

• Speed – can be achieved dependant on the structure of the budget model• Flexibility – very flexible if the model is built correctly• Intelligence – allows for consolidation, multiple views and analyses• Ease of use – limited training for input users

EXCEL BASED

• Speed – download to excel required for review, reporting and analyses• Flexibility – limited to input only, download to excel for further use• Intelligence – limited use, download to excel required• Ease of use – limited training for input users, download to excel for further

use with further manipulation required

PROTEA BASED

Objective: to facilitate a budget process with speed, flexibility, intelligence and ease.

Immediate solution: use MS Excel to develop user-friendly input templates and a budget for easy consolidated, analyses and presentation.

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BUDGET PRINCIPLES

Balanced budget to be achieved

Zero-based approach

Cross-subsidisation

Broad Participation and Shared Responsibility

Fairness and Transparency

Accountability

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Key Inputs and Parameters Develop Budgets Review and Refine

Developed by Finance and budget holders. The various budgets are consolidated to develop the university budget.

Developed by Finance and budget holders. The various budgets are consolidated to develop the university budget.

Finance reviews and refines budgets with budget holders. Budget is presented to Budget Committee for further refinement.

Finance reviews and refines budgets with budget holders. Budget is presented to Budget Committee for further refinement.

Determine the key inputs and parameters. Budget manual is prepared and distributed.

Determine the key inputs and parameters. Budget manual is prepared and distributed.

Budgets include Subsidy Income, Student fees, Academic expenditure, Capital Equipment, etc.

Budgets include Subsidy Income, Student fees, Academic expenditure, Capital Equipment, etc.

Academic departments, Divisions, Residences, Consolidated University, Surplus/Deficit.

Academic departments, Divisions, Residences, Consolidated University, Surplus/Deficit.

Inputs include Enrolments, Fees, etc.Parameters include CPI %, Salary Increase %, etc.

Inputs include Enrolments, Fees, etc.Parameters include CPI %, Salary Increase %, etc.

Budget is presented at F&GP, Senate and finally Council for approval. Budget holders are advised of their final budget allocations.

Budget is presented at F&GP, Senate and finally Council for approval. Budget holders are advised of their final budget allocations.

Consolidated University and Residences budgets, detailed per Division. Balanced budget.

Consolidated University and Residences budgets, detailed per Division. Balanced budget.

Approval and Sign-off

BUDGET PROCESS STEPS

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Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov

Transfer running budget grants

Budget launch with budget manual distributed

Budgets consolidated and reviewed

Preparation for new budget

Budgets developed throughout University

Budget presented at Budget Committee

Budget finalised and communicated to stakeholders

Dec

Budget presented for approval at F&GP and Council

BUDGET CYCLE

Academic capital budget grants allocated

6 MONTHS

BUDGET2014

CONTENT

Purpose of Budget Launch

Budget Process Key Elements Strategy Budget Information System Budget Principles Budget Process Steps Budget Cycle/Timeline

Budget 2014 Key Parameters Budget Templates Budget Submissions Time-table

Questions

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BUDGET 2014 KEY PARAMETERS

RU BENCHMARKS

INCOME Budget 2013 Budget 2014 COMMENT

1 Block Grant Subsidy increase 8% 7.5% Preliminary

2 Student Fee increase 8% 8% Preliminary

3 Student Enrolments 7645 7861

Proposed3.1 Under-graduate 5329 5561

3.2 Post-graduate 2273 2255

3.3 Occasional 43 45

EXPENDITURE

4 Staff Cost : Income ratio 69.6% 68.0% Preliminary

ECONOMIC INDICATORS

CPI Actual 2012 Actual 2013 COMMENT

5 Headline 5.7% 5.5% STATSSA June 2013

6 Eastern Cape 5.3% 4.9% STATSSA June 2013

7 Tertiary Education 9.7% 8.8% STATSSA June 2013

EXCHANGE RATES

8 Rand/US Dollar 8.21% 10.05% Ave till June 2013

9 Rand/Euro 10.54% 12.10% Ave till June 2013

10 Rand/Pound 13.01% 14.24% Ave till June 2013

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BUDGET TEMPLATES

Purpose of Templates Tool to capture budget Standardisation Facilitates analyses and consolidation

Need for Improvements on existing templates Insufficient ability for analyses and consolidation Inconsistent naming of expenditure items Slow and manual process

Features Historical figures are pre-populated for comparison Budget against GL Accounts Option to enter annual or monthly figures (academic departments) Monthly figures required from Support Divisions

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BUDGET SUBMISSIONS

ACADEMIC DEPARTMENTS1

INSTITUTES AND UNITS2

STUDENT ACTIVITIES3

SUPPORT DIVISIONS

Expenditure Budget X X X Form E

Running Grant Form B Financial forecast

Financial forecast X

Academic Capital Equipment Form D X X X

Furniture & Equipment Form C Form C Form C Form C

Sign-off HOD & Dean DirectorDean of

Students / Registrar

Director

1. Includes Deans’ offices.2. Includes Community Engagement, International Office, RUMEP, LAC, EBRU, CSD, ISEA, RUMEP, David Rabkin.3. Includes SRC, Sports Administration, Rhodes Music Radio

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BUDGET 2014 TIME-TABLE

DATES TIME ACTIVITY ACCOUNTABLE VENUE

29-Jul-13 09h00 Budget Committee Meeting - Budget Launch Finance Council Chamber

29-Jul-13 16h00 Budget Packs made available via Finance website (TopList) Finance  

30-Aug-13 16h30 Due date for return of Budget Requests from Budget HoldersDepartments /

Divisions / Units 

10-Oct-13 09h00 Budget Committee Meeting - 1st review of draft budget All Council Chamber

25-Oct-13 14h15 Fees Schedule presented to Senate for comment Finance Council Chamber

29-Oct-13 09h00 Budget Committee Meeting - final review of draft budget All Council Chamber

14-Nov-13 11h00 Budget presented to F&GP Finance Council Chamber

5-Dec-13 10h30 Budget presented to Council for approval Finance Council Chamber

12-Dec-13 12h00 Advise Departments/Divisions/Units of budget allocations Finance  

1-Apr-14   Spending against Academic Capital Grants Commence Departments  

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END

QUESTIONS ?