Obtain a copy of a government’s recent operating budget document from its website. Familiarize yourself with the organization of the operating budget document; read the letter of transmittal or any narrative that accompanies the budget.

Required
Answer the following questions, which aid in assessing the quality of the budget document you are reviewing.

Introduction and Overview. 

Does the operating budget include a table of contents to help you locate information in the document? Does the budget document include a coherent statement of organization-wide goals and strategies that address long-term issues? Does the document address short-term factors that influence the development of the budget? Does it include a budget message that articulates priorities and issues for the upcoming year? Does the budget document provide an overview of significant budgetary items and trends within the budget document? 

Financial Structure, Policy, and Process. 

Does the budget document include an organization chart? Does the budget document describe all funds that are subject to appropriation? Does the document include narrative, tables, schedules, or matrices to show the relationship between functional units, major funds, and nonmajor funds in the aggregate? Is the basis of budgeting explained for all funds—whether cash, modified accrual, or some other statutory basis? Is a coherent statement of entity-wide long-term financial policies included? Does the document address the process for preparing, reviewing, adopting, and amending the budget?

Financial Summaries. 

Does the document present a summary of major revenues and expenditures as well as other financing sources and uses? Does the document include summaries of revenues, other financing sources, and expenditures and other financing uses for prior-year actual, current-year budget and/or estimated current-year actual, and proposed budget year? Does the document include projected changes in fund balances for governmental funds included in the budget presentation, including all balances potentially available for appropriation? Are major revenue sources described? Does the budget document explain long-range financial plans and potential impacts upon the budget and budgeting process?

Capital and Debt. 

Does the budget document include budgeted capital expenditures (even if these are authorized in a separate capital budget)? Does the document describe whether, and to what extent, significant and non-routine capital expenditures or other major capital spending will affect the entity’s current and future operating budget? Are financial data on current debt obligations
provided, describing the relationship between current debt levels and legal debt limits and explaining the effects of existing debt levels on current and future operations?

Departmental Information. 

Is a schedule(s) or summary table provided giving personnel or position counts for prior, current, and budget year(s)? Does the operating budget describe activities, services, or functions carried out by organizational units? Does it include clearly stated goals and objectives of the organizational units? Are objective measures of progress toward accomplishing the government’s mission, as well as goals and objectives, provided for specific units or programs?

Document-wide Criteria. 

Does the document include statistical and supplemental data that describe the organization and the community or population it serves and provide other pertinent background information related to services provided? Is there a glossary to define terms (including abbreviations and acronyms) that are not readily understood by a reasonably informed reader? Are charts and graphs used, where appropriate, to highlight financial and statistical information? Is narrative information provided when the messages conveyed by the charts and graphs are not self-evident? Finally, is the document produced and formatted in such a way as to enhance understanding by the average reader?