Financial Health

Preparing a budget is essential for effective planning and should run alongside the project plan.

 

 Budgeting will help to:

• Estimate project costs
• Identify funding needs
• Inform financial decisions and avoid unexpected costs
• Plan for contingency
• Keep track of when payments need to be made
• Understand, in monetary terms, what your group is going to do

 

 A budget will include

 

Expenditure: items to be paid for; overheads including leases/ rent, insurances, equipment, salaries, marketing and publicity costs. Office costs are also included such as phone, postage, travel costs for meetings and activities. Unknown costs should be estimated.

 

Capital or Revenue: expenditure items are classed as capital or revenue. Capital items will be equipment with a resale value for up to 2 years. Revenue items are day-to-day or running costs such as rent, admin and volunteer expenses as well as hidden costssuch as insurance or phone credit.

 

Income:  Initially this will be income from grants already received and anticipated amounts from grants that may be awarded, membership subscriptions, fees and donations.

 

Budget presentation

• Use a format such as a basic Excel spreadsheet, or simple tables with columns and rows.
• Quotes should be obtained for each item listed in your budget. Funders will require evidence of competitive quotes.
• Figures should be accurate, underestimating could lead to future financial difficulties and overestimating could affect funding application decisions.
• The budget should be regularly updated with changes to costs and income.
• Updates should be presented in the treasurer’s finance report to the group.
• The report should show actual income and expenditure against the budget figure.

 

Business Planning  

WCVA - The Business Plan

WCVA - Business Planning

 

Getting Money 

WCVA - Finding and getting money

 

Managing Money

WCVA - Managing money

NCVO - Finance 

Resource centre - Budget for community groups