ACTIVITY 4 The Budget or Finance Policy If you have found a budget or finance policy then, 1. Review the policy in line with the 11 dot points below. How many of these elements does your policy have?

A budget policy would ideally consider the following elements:

- The organisations functions, programs, outputs and outcomes and how these relate to organisational and budget structures;

- The organisations current and longer-term fiscal strategy (including, for example, senior managements position on balancing the budget and drawing on accumulated reserves or surpluses);

- Broad strategic priorities on which the internal budget is based;

- The organisations budget objectives and targets for the budget year and forward estimate period with sufficient detail to guide operational areas, individually and across outputs and programs;

- Planned sources of income and how these are to be allocated (including receipts from independent sources);

- Key measures against which budget allocations and submissions will be assessed;

- Key internal and external planning assumptions to be applied across the organisation (for example, salary rates, indexation factors, and productivity gains);

- The reporting basis on which the budget will be prepared;

- Expected impacts and treatments of one-off or temporary conditions in the organisation or in the external market;

- Circumstances under which a departure from the above principles, parameters and assumptions is permitted; and

- Governance arrangements to be followed in developing and approving the internal budget.