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The Analysis of the Future Prospects of the Budget - Essay Example

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The paper "The Analysis of the Future Prospects of the Budget" focuses on the fact that budgets have been very helpful as forecasts used by organizations and governments to predict and get prepared for possible spending trends in the future financial years…
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The Analysis of the Future Prospects of the Budget
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? Budget Analysis Savannah Alexander Eastern Michigan Dave Ivers PLSC 352 Public Budgeting Introduction Budgets have been very helpful as forecasts used by organizations and governments to predict and get prepared of the possible spending trends in the future financial years. The process of budget preparation is often complex as it requires inclusion of various aspects of the financial nature an organization. Budgets are mostly prepared during the late periods of a given financial year in order to depict the costs of the intended programs by the planning committees of given organizations The main aim of this paper is to answer questions of what factors and consideration are taken into account while preparing a budget and future prospects of the budget. Budget analysis Determination of Goals and objectives of the City It is very important to determine and consider the goals and objectives of the City Council of the Ypsilanti in the initial stage of preparing the council’s budget. Knowing the goals and objectives will help me as the budget officer understand and draw appropriate boundaries that reflect mission and annual goals of the organization1. Goals and objectives of the council will work as benchmark that guide me in staying within the limits of the council’s expectations of growth and development. Determination of Expenditure As the budget officer of the City of Ypsilanti, I will make thorough and critical consideration of the current expenditures incurred to help me in structuring and estimating the scope of expenditure likely to be incurred during the next financial year. As the budget officer of Ypsilanti City I will determine the contemporary expenditure records of the city council on various areas of its operation. This will help me draw a budget forecast of the next financial year.2 I will basically make consultations with the accountant and financial officers in the council. This move will assist me in collecting all receipts and or any other testimonials that disclose any kind of expenditure incurred by the council. As in the case of this city that witnesses daily entrance and exit of 20, 000 university students, I will need to determine the average daily costs incurred by the City Council of Ypsilanti to host such visitors. In addition, I will need to determine the total expenditure incurred by the council in caring and managing the 35000 potential residents of the city. The outcome will be added to the previous expenditure on visitors to determine the total cost on human operations. These expenditures together with other operational costs shall be calculated with high level of diligence and accuracy. With forecasts on the possible changes in future, I will be able to draw a realistic budget for the city council3. Determination of Income For the budget administrator to draw a convincing and propelling budget that will attract the attention and recognition of the council legislators, he/she should indicate the possible incomes expected and their possible sources. I recognize that determination of income and their sources is a crucial stage that requires utmost diligence to convince the legislature to pass the budget. 4Indicating sources of income will make the budget of the City Council of Ypsilanti appear realistic and convenient. This will likely attract good participation and speculation of the legislators. As the budget manager in this city, I have decided that the city authority raise the gas tax to 51% and also raise vehicles registration fees to 57% in order to avail funds for repairing the road systems in this city. Other sources of required funds for the roads maintenance will also be gathered from 33% tax increase in the mileage travelled by vehicles operating within the city. Ensuring balance The next and probably sensitive point in preparing the budget of the city council is achieving a balance between the expenditure and the expected income. I understand that council legislatures will not approve any budget viewed to cause big deficit above the financing power of the council. In this case, the budget administrator should just draw budget incoherence with the income however small. Any attempt to make the budget rely on the speculated steps to increase income in the future may appear unrealistic and may result to big deficit5. Legal and logistics problems As the budget officer of the City of Ypsilanti, I will ensure that I structure a budget that conforms to the US budgetary allocations. I will also take keen regard to the Michigan Income tax Act to determine the amount of tax levy to extend to the corporate and individuals in order to expand the income base. As a move to cut on the transport and logistics costs, I have instructed authorities to set their priorities right. Doing so will help facilitate and ensure that organization of supplies are adequately done. Under logistics, the schedule of shipping should also be adequate to work with a give time line. Coordination of paper work and tracking of goods should also been considered while budgeting for the city. The above mentioned points should be taken into consideration to know what is to be spent on what. Political feasibility I will take into consideration the nature and mood of politics in the surrounding atmosphere. This will direct on how to structure an effective budget that does stand and remain stable over the uncertain political changes. Becoming sensitive to the political matters will enable me structure a budget that address the political mood of the community and be in position of avoiding any resistance from the public. The budget that I prepare will also be determined and validated on the concerns of national politics reigning in Ypsilanti and Michigan as whole. It will be easier for the budget administrator to arrive at adaptable budget when contemporary political atmosphere is peaceful than when in turmoil. To pass the budget to the adoption, I will require approval of the six member of the council who are also local political leaders. The inclusion of local leaders into this budget approval is due to their expanse knowledge of what citizens in the grassroots expect to be adjusted or introduced. The budget will also require the ascent of the city mayor the city. Future prospects and solutions With rising levels and demand for literacy, the population of visitors streaming into the city is likely to grow in the future. The council will experience rise in the demand for shelter and recreational facilities within the city. This fact will automatically lead to rise in demand for services provided by the city. However, the speculations and forecasts I have made are not meant to scare any official or member of the public. Instead the speculations should be taken positive as an impetus towards hard work and diligence. These are only the ways that can help in setting the economy on a rising trend along the next 10 years. 6As the budget administrator of the city, I have decided to apply for government grants amounting to $30 million. This grant when accepted will enable the construction and establishment of other creational facilities and supply of clean water to the residents. The funds will also be spent creating some job opportunities to focus on reducing the unemployment rate from the current 9.6% to 5.0% by the end of 2013. 7I have set measures and strategies that will see the city authority pay budget deficits that may accrue during 2013 fiscal year by use of our portion of general grants. The funds proposed for art and culture will also help our city create significant job opportunities for our local population. I have also structured adaptable measures that will see the city set aside a portion of the proposed $195 million state grant for jobs creation. Part of the funds allocated for arts and culture will also be used in promoting tourism within the city. This is yet another sure way of consolidating sources of income for the future years. With the annual government grants to city authorities, as a budget administrator of the City I have proposed for approval of tax cuts on investors and providing capital to businesses. These programs shall be financed by part of the $50 million proposed by Governor Sydney for economic attraction8. This measure is forecasted to revive businesses and restore employment opportunities within the city with speculation of an increasing tax base in 85% in the next 5 years. As a way increasing the investments made by the City, I have proposed that 30% of the government grants be used in refurbishing and construction of houses. As the budget officer I have also made moves to cut on the expenditures accrued in purchasing equipments and provision of discounts. These measures are believed to help in balancing the budget and reduce the effects of deficits. I have also identified financial remedies from the President Obama’s $15 billion economic stimulus plan. When the city receives its share of the grant, the authority will be able create job opportunities as well as training individuals as proposed in the stimulus plan. The budgetary proposal by Governor Snyder should fully be adopted as it reflects the best practices. For example, the budget seeks to allocate more funds in education sector in order to empower many citizens and open chance to good employment opportunities. The budget also intends to promote gender equality by funding equal opportunities for both women and men, and boys and girls. Conclusion From the above situation, it can be summarized that, budget entails a lot in order to complete. For instance, the first thing to be put into consideration is income or the available resource. As a city planner, one has to consider the resources allocated for a specific town having in mind the population of the city. One should gather past income statements for the city. From the statements, determination of upcoming income can be established. For a city, all its sources of revenue and income are established and then the amount can be approximated by summing up all the incomes by the city. The second factor to be considered is the expenditure of the city. All the expenditure the city has for a given period of time should be noted down. The there is the issue of law and logistic that accompany this. One must also consider future prospects. Lastly, the budgeter has to make sure that everything is included in the budget is according to law and regulation of that specific state. In case there is a tax, it should be treated as a deduction and, therefore, fall under expenses. Bibliography Uyu, M. & Tisch, S. (2011). City Of Ypsilanti Michigan: Comprehensive Annual Financial Report For The Fiscal Year Ended June 30, 2011. Retrieved April 16, 2012 from: http://cityofypsilanti.com/Portals/0/docs/Accounting/Audits/CAFR/CAFR%206-30-11%281%29.pdf City of Ypsilanti. Retrieved April 16, 2012 from: http://www.cityofypsilanti.com/ SEMCOG. (2011). SEMCOG/MAC citizen survey results: Overwhelming support for increased revenue for transportation, transit. Retrieved April 16, 2012 from: http://smcg.informz.net/SMCG/archives/archive_2285788.html Marshall, R. (2012).YPSILANTI: City prepares for income tax, millage special election. Retrieved April 16, 2012 from: http://www.heritage.com/articles/2012/03/21/ypsilanti_courier/news/doc4f68857bb966f907469183.txt Peter. (2012). Gov. Snyder Unveils 2012-2013 State Budget. Retrieved April 16, 2012 from: http://wienerassociates.com/2012/02/22/gov-snyder-unveils-2012-2013-state-budget/ Read More
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