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Handbook of Business Procedures

Date published: 
Last revised: 
Issued by: 

April 6, 2012
April 6, 2012
Budget Office

 

Part 3. Budget - Table of Contents


3.1. INTRODUCTION AND RESOURCES

A. Introduction

1. What is a budget?
A budget is a proposed financial statement for the upcoming fiscal year based on current year expenditures and resources. Preparation of an annual budget allows departments to estimate and plan financially for the next fiscal year and provides a way for the Budget Office and Office of Accounting to set spending authority on departmental budgets.

2. Why prepare a budget?
Developing an annual budget is essential to any organization’s financial success. An annual operating budget is required by Texas state law and by The University of Texas System’s Board of Regents. Additionally, The University of Texas at Austin’s annual operating budget provides data for reporting to UT System’s administration and to the Texas Legislature.

B. Creating a Budget

1. Account Data
Budget groups must be created in the accounting system before they can be added to the budget. Not all accounts need to be included in the annual operating budget. The Office of Accounting is the primary source of account data and maintains records for more accounts than are actually included in the university’s official operating budget. For guidelines about what accounts to budget, go to the What do I budget? Web page.

2. Expenditures
Expenditures against accounts are often referred to as either budgeted or actual, where “budgeted” refers to the estimated expenditures for a budget group shown in the operating budget and “actual” refers to account transaction details, which are displayed in the university’s accounting information system.

3. Preparation and Approval of a Budget
Departmental budgets are prepared using the Budget Update Document (BUD), a Web-based document designed to set the budget for a specific budget group. Each department’s budget establishes spending authority and limits in the accounting system. The operating budget of the university is compiled by the Budget Office using the departments’ budgets. The operating budget is then reviewed and approved by the Board of Regents, the governing body for UT System. After the university’s operating budget has been approved by the Board of Regents in mid-August, spending authority is created for each account included in the budget. For more information about the university’s operating budget, see the Handbook of Business Procedures, 3.2. Operating Budget.

C. Changing a Budget

Changes to budgets are sometimes needed for operational purposes throughout the fiscal year. Budget adjustments can be made on a temporary basis with approval from the administrative delegate of a department’s dean (see College/School Final Approvers) or vice president (see Vice President Final Approvers). For more information, see 3.3 Operating Budget Adjustments and Changes.

D. Semiannual Account Balance Review

Account balances are reviewed semiannually by the Budget Office to ensure that all income and expense budgets accurately reflect the level of revenue and spending occurring in each budget group. For more information about the balance review process, see 3.4 Disposition of Fiscal Year-End Account Balances

E. Resources

 

 

Part 3. Budget - Table of Contents