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NPO budget help

(1 Post)
EnPeeOh Sun 12-May-13 09:39:35

I have been volunteering for a smallish NPO for a few years now. I recently took on a larger role of doing the books.

Every year the budget gets made in April, a committee is formed to discuss it by email, and then it is voted on at the board meeting in June.

It sounds normal, right?

But the budget we are making is for this year not next year. So by the time the budget is passed half the year is gone.

Some of the things we are budgeting for have already been bought.

One category I wrote 103.65 pounds as that was its actual cost but the but the committee said no, the budget for that is always 90 pounds. So we are over-budget on that? Yes, we are always over-budget on that. Why not budget 105 pounds? Then we can be under-budget. Apparently it doesn't work that way.

I think it is kind of a farce.

Apparently the reason we do it this way is so we can include information about last year's income and expenses in the budget report. I asked why that wasn't written in the annual financial report. Apparently we don't make an annual financial report. They have sort of combined the two.

I think it is very strange to make a budget after the year has started.

I want to suggest that we make the budget in the autumn before and that it is just based on our predicted income/expenditure and then we make a financial report in the new year to explain our actual income and expenses for the past year.

Does that make sense? Or how should it be done?

I know certain people won't want to change as it has been done this way for 30 years but I think if it is wrong then we need to change it.

I'm kind of young and new to the NPO but I think our current leader is very open to change. I just don't want to make a complete arse of myself if I am wrong.

I should probably add that as the budget never changes then our budgeted expenses for this year is about 25% more than our likely income. This looks crazy on paper but as our actual expense will be nothing like the budgeted expense then we will probably only be about 5% over budget. Why make a budget that doesn't remotely reflect our likely income/outcome. Madness, I tell you!!

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