ASSIGNMENT
ON
Budgeting and Financing
Submitted To:
Madam Sajida Ghani
Submitted By:
Muhammad Bilal
Roll No.mcf1601643
M.Ed 1st Semester (Morning)
University Of Education Lahore
Multan Campus
Budgeting and Financing
Budgeting:
Budgeting is defined as the process of preparing a plan of financial operation
embodying an estimate of the proposed expenditures for a given period and purpose.
Budget can be briefly defined as a plan of activities in a time period relating their costs to be
resources available.
According to Aaron WildaVsky, a preeminent expert, a budget is:
a prediction of expenses;
the "link between financial resources and human behaviour in order to accomplish
policy objectives";
a representation in monetary terms of governmental activity
a record of the outcomes of the struggle over political preferences; and "attempts to
allocate scarce financial resources through political processes in order to realize
disparate visions of the good life."
Budgeting in Pakistan:
All organizations have a budget. The money they are allotted is broken up differently
according to region and location, so it is important to be aware of how the money should be
spent. Some areas prefer a stronger emphasis on one sport over another, or the budget is
simply not large enough to accommodate very many alternate athletics options. This is where
strict budgeting can come in handy. When you’re making your budget, remember to assess
what areas require the most money, and to cut out any unnecessary expenditure. This frees up
money for other athletics programs and keeps your organization from overspending where it
isn’t needed.
A few tips for budget preparation:
When are membership fees/dues, fundraising, and donations coming in?
In spite of a set day for fees or dues, or when a fundraiser or donation is scheduled to
come in, it may be late. It may take time for the money to be gathered and delivered,
so allow your budget wiggle room for this.
Are the expenses seta realistic level? Use prior reports to determine if the amount of
money going out makes sense. If too much money is spent in one area, you won’t
have the budget for other opportunities.
Does the number of members affect the expenses? Some athletics programs require
equipment or uniforms to be bought for each individual player. This causes the cost to
be higher, so allowing new sports programs into your organization should have this
factored into the decision making process.
Set aside money for large expenses; emergency funding, gas and drivers for travel,
drinks, hotels, and more.
Short-term and Long-term Budgeting:
The major difference between short-term and long-term budgeting is relatively
simple. Short-term is usually anything that refers to less than a year, and long-term is
anything over that. Short-term expenditures are anything that you will have to pay money on
now and that won’t be used again and again. This might be uniforms, food and drinks, gas
money, insurance payments, etc. Whereas long-term might refer to large training equipment
or vehicles. Setting a short-term budget first will show you how much money is left in the
budget for long-term investments. It is pertinent to attempt to set aside enough money for
both, but it is not always possible. This is where a sharp mind and determination come into
play.
Role of Budget:
The true role of a budget is as a tool of development planning and management control in
the development, plan of a country. Governments of advanced countries, committed to the
policy of full employment and the concept of the welfare state, have now made significant
contributions towards reorganizing their budget systems.However,a budget may be treated as
a tool of economic planning in three ways;
a. The budget in a planned economy is a budget of national resources and output
capacity.
b. Alternatively budgets can be drawn up in terms of annual plans.
c. The role of a government’s budget in the achievement of national goals lies in its
emphasis on capital formation for accelerating the rate of growth and development.
Purposes of Budgeting:
The main purposes of budgeting are:
a. To establish in advance the objective or end result of the budget period.
b. To provide the means of coordinating the activities of the various departments in the
organization.
c. To provide period to period basis of comparison to show whether the plans are being
realized and, indicate when changes must be made if current objectives are to be
achieved.
Phases of Budgeting:
Budgeting is the process of preparing targets; it has several phases at district,
divisional, provincial and federal levels. These phases are;
1. Phase-I
Identification of programmes projects or activities.
2. Phase-II
Identification of the resources in terms of manpower money, machine and material.
3. Phase-III
Costing of resources.
4. Phase-IV
Presentation of the budget.
5. Phase-V
Obtaining approval of the appropriate authority.
Financing:
According to Doherty (1984):
Financing of education is concerned with such questions as below;
Who pays for education?
Who gets benefits from education?
Who Pay for Education?
The question of who pay for education is question of facts and figures which can be
answered with precision, given adequate financial statistics. The question of whether new
sources of finance are desirable or feasible, in the future, is much more controversial and
involves value judgements about the political and social implications of alternate methods of
raising funds, the effect of different finance systems on the quality and control of educational
institutions and consequence of new ways of paying for education for the distribution of
income or educational opportunity. (Woodhall, 1972)
1) Institutions or individuals.
2) Levels of decision makers in the financing of education.
3) Sources of educational finance in Pakistan.
Who benefits from education?
We shall remained you of the principles of equity and efficiency, and discuss the financing of
education in the light of these principles.
Equity:
Equity is concerned with the way in which the cost and benefits of education are
distributed. Thus it is concerned with the distribution of sources and whether this distribution
is fair or not according to some value judgement about the justice of various distributional
outcomes (blaug and Macc, 1983)
Efficiency:
The efficiency of educational process refer to the degrees of waste of resources within
a given techniques. (Sheehan, 1973)
Objectives of the schemes for Student Finance.
Different scholarship schemes.(International scholarship,Nishan-e-Baider,Quaid-e-
Azam scholarship,centeral overseas training scheme)
Different loan schemes,
Alternative strategies for financing in Pakistan:
The alternative strategies for financing education in Pakistan some could be tested in
the country after due consideration.
Direct subsidy to institutions to eliminate or reduce fees.
Direct subsidy to students in the form of unconditional grants like scholarships and
stipends.
Direct subsidy to selected students in the form of grants, stipends and scholarships.
Direct subsidy to students in the form of guaranteed and interst”free loans.
Free accommodation for students
Conclusion:
Most of the above budget and financing approaches are managerial in their nature, in
the sense that there is a rational decision making process involved. There is no specific way
to create a budget, do forecasting, or to create a financial plan. This, while it would normally
seem to make it more difficult, actually gives you room to create a plan that fits your specific
organization. A financial plan notes predicted cash flow, assets, and works in accordance
with net worth, tax liabilities, insurance, and much more. The plan you create will set out the
ground work for all the money coming in and out of your organization.
References
1. Muhammad Arshad (2012-13) An Educational Persona M.Ed (p.195, 196) Majeed
Book Depot Lahore.
2. Budgeting,Retrieved on December 20,2016from
http://www2.fiu.edu/~ganapati/3003/budget.html
3. Budgeting Planning (n.d),Retrieved on December 20,2016 from
http://professional.bu.edu/programs/financial-planning/online/
4. S.M Shahid (n.d) Educational Administration, Budgeting (P.152, 153,154,155,161)
Majeed Book Depot Lahore.
5. S.M Shahid (n.d) Educational Administration, Financing (P.133,
134,135,140,141,147,151) Majeed Book Depot Lahore.
