Projected Expenses: Add To Parts 1 And 2 Of Your Organizatio

Projected Expensesadd To Parts 1 And 2 Of Your Organization Wide Opera

Identify the projected expenses for Year 1 by adding to Parts 1 and 2 of your organization’s wide operating budget. Estimate annual costs based on your proposed facility and staffing, prioritizing expenses from most to least important, and provide rationale for each category and amount. Use Worksheet B.6-8 as a guide, consider personnel costs with benefits (typically 15% added), and account for facility-related expenses which may exceed personnel costs. Consult Chevarley et al. (2006) for expense projection support. The length of the assignment should be 2-3 pages with proper references.

Paper For Above instruction

Effective financial planning and budgeting are critical components for the sustainability and success of any nonprofit or service-based organization, particularly in the context of mental health services. Developing a comprehensive Year 1 projected expenses budget requires strategic prioritization, justified categorization, and a thorough understanding of the essential cost components. This process ensures that resources are allocated efficiently, enabling the organization to deliver quality services while maintaining fiscal health.

To commence the budgeting process, it is imperative to identify and estimate the myriad expenses that will be incurred within the first year of operation. These expenses generally bifurcate into personnel costs and facility-related costs, with the former traditionally constituting the largest portion of the budget. Personnel costs encompass wages, salaries, and benefits, often estimated by adding approximately 15% to a base salary to account for fringe benefits such as health insurance, retirement contributions, payroll taxes, and other employment expenses. For example, if a mental health counselor’s annual salary is projected at $60,000, benefits would be an additional $9,000, making the total personnel expense $69,000. Multiple staff roles, including therapists, administrative personnel, and management, will require similar calculations to derive an accurate personnel budget.

Facility-related expenses can vary significantly depending on the organization’s location, size, and operational model. These include rent or mortgage payments, utilities (electricity, water, internet), maintenance, insurance, security, and furnishings. According to Chevarley et al. (2006), facility expenses in urban settings can sometimes surpass personnel costs due to higher rent and operational costs. Precise estimates involve obtaining lease agreements or market rates for the desired location and factoring in indirect costs such as utilities and insurance, which are essential for a realistic budget projection. For example, leasing a modest office space may cost $3,000 per month, totaling $36,000 annually, while utilities and insurance might add another $5,000-$7,000 annually.

Prioritizing expenses from most to least important is essential for contingency planning and cost management. Critical expenses, such as staffing to deliver the core services and facility costs to house them, should be prioritized to ensure service continuity. Non-essential expenses can be scaled back or deferred if budget constraints tighten. For instance, advanced technology upgrades or decorative renovations may be deferred in favor of maintaining adequate staffing levels and facility operations.

Additional costs to consider include supplies, administrative costs, training and development, licensing, and compliance expenses. Supplies such as office materials, educational materials, and therapeutic tools are recurring and vital for daily operations. Administrative costs encompass billing, accounting, and legal services necessary for regulatory compliance. Training and professional development ensure staff remain current with best practices and ethical standards. All expenses should be justified with clear rationale based on organizational needs and operational goals.

Using Chevarley et al. (2006) as a guiding resource, projections can be refined by analyzing current expenditure patterns and adjusting for inflation or anticipated changes in service demand. This research emphasizes the importance of culturally-specific healthcare materials, especially for urban or low-income populations, which may entail costs for translation services, culturally competent training, and community outreach. Incorporating these expense considerations enhances the budget’s accuracy and relevance.

In conclusion, a well-structured projected expenses budget for Year 1 integrates detailed cost estimates, prioritization based on organizational importance, and justifications grounded in empirical research. This strategic approach facilitates resource allocation, supports program sustainability, and positions the organization for successful service delivery in its initial year.

References

• Chevarley, F., Owens, P. L., Zodet, M. W., Simpson, L., et al. (2006). Health care for children and youth in the United States: Annual report on patterns of coverage, utilization, quality, and expenditures by a county level of urban influence. Ambulatory Pediatrics, 6(5), 241-264.
• Dropkin, M., Halpin, J., & LaTouche, B. (2007). The budget-building book for nonprofits (2nd ed.). San Francisco: Jossey-Bass.
• BoardSource. (2012, April 3). Responsibilities of Nonprofit Boards - 6 of 10 - Ensure Adequate Financial Resources [Video file]. Retrieved from [URL]
• American Psychological Association. (2017). Ethical Principles of Psychologists and Code of Conduct. Retrieved from [URL]
• Office of Budget (OB). (2017). HHS FY 2017 Budget in Brief. U.S. Department of Health & Human Services. Retrieved from [URL]
• Rae, W. (2009, February 6). Making a Budget: How to Create a 0-Based Budget. eHowFinance. Retrieved from [URL]
• National Institute of Health (NIH). (2015). Grants and funding: NIH's central resource for grants and funding information. Retrieved from [URL]
• BlueCross BlueShield of Tennessee. (n.d.). Behavioral Health Specific Billing Guidelines. Retrieved from [URL]
• Sperling, P. (2015, February 20). President Obama’s 2016 Budget: What does it mean for mental health? The Substance Abuse and Mental Health Services Administration. Retrieved from [URL]
• Hornor, J. (2009, May 26). Small Business Basics: How to Understand a Profit-Loss Statement. eHow. Retrieved from [URL]