Week 2 Discussion: Watch The Video Below Titled Nasbo The St
Week 2 Discussionwatch The Video Below Titled Nasbo The State Budget
Week 2 Discussionwatch The Video Below Titled Nasbo The State Budget
Week 2 Discussion Watch the video below titled “NASBO The State Budget Process” (6 min 01 s). Video Source: National Association of State Budget Officers (NASBO). (2013, May 20). NASBO The State Budget Process [Video file]. Retrieved from . Analyze the steps in the budgeting process summarized in the NASBO presentation and discuss how the actions in the process can improve the value and reliability of budget-to-actual comparisons used in budget estimates. Provide an explanation for the budget-to-actual limitations.
Paper For Above instruction
The budgeting process is a fundamental element of fiscal management at both the state and federal levels, ensuring that public resources are allocated efficiently and transparently. The National Association of State Budget Officers (NASBO) delineates a structured series of steps in its presentation that guide policymakers through a comprehensive approach to developing, approving, and monitoring budgets. The key stages include establishing budget assumptions, preparing budget requests, reviewing and editing proposals, legislative approval, and ongoing budget monitoring and adjustments. Each step plays a crucial role in enhancing the accuracy, transparency, and accountability of fiscal planning.
The initial phase involves setting budget assumptions, where policymakers forecast revenue streams and economic conditions. Accurate assumptions create a solid foundation for realistic budget estimates. Once assumptions are established, agencies prepare budget requests based on their needs, which are then reviewed and revised by budget authorities. The review process ensures that allocations align with policy priorities and fiscal constraints. Following this, the legislative body approves the budget, often modifying initial proposals, which underscores the importance of legislative oversight in aligning budgets with public priorities.
After budget enactment, continuous monitoring of expenditures against the budget is crucial. Agencies and budget officials analyze variances to identify discrepancies and justify adjustments or reallocations. This ongoing oversight process fosters accountability and enables timely responses to fiscal changes. Regular reporting and evaluation strengthen the link between budget estimates and actual fiscal performance, which enhances the overall reliability of budget-to-actual comparisons.
Improving the value and reliability of budget-to-actual comparisons involves several actions within this process. First, integrating more precise data collection and forecasting techniques during the assumptions phase reduces discrepancies between projected and actual revenues and expenditures. Second, maintaining transparency and clarity in budget proposals allows for better scrutiny and understanding, which leads to more accurate estimates. Third, establishing standardized procedures for variance analysis ensures consistent evaluation of discrepancies, facilitating better corrective actions.
Despite these improvements, limitations persist in budget-to-actual comparisons. One primary limitation is the difficulty in predicting economic variables accurately, such as shifts in revenue sources like taxes or federal transfers, which are often influenced by unpredictable economic conditions. Additionally, unforeseen events, such as natural disasters or legislative changes, can drastically alter fiscal realities after budgets are established. Administrative delays and scope changes in program implementation can also skew comparisons, since expenditures might not align with initially planned activities.
Moreover, differences in accounting methods—such as cash versus accrual basis—can complicate comparisons, making it challenging to interpret variances uniformly. These limitations highlight that budget-to-actual comparisons, while valuable, are inherently constrained by economic unpredictability and operational complexities. Nonetheless, by rigorously following a structured budgeting process and applying analytical rigor during the monitoring phase, governments can enhance the accuracy, reliability, and usefulness of these comparisons, ultimately leading to better fiscal decision-making and public trust.
References
National Association of State Budget Officers. (2013). NASBO The State Budget Process [Video]. Retrieved from https://www.nasbo.org
Welch, E. W. (2014). Public budgeting systems. Jones & Bartlett Learning.
Neu, N. (2010). Budgeting, financial management, and financial reporting. In K. A. Hankin (Ed.), Government and Not-for-Profit Accounting (pp. 155-174). McGraw-Hill Education.
Cawley, J. (2018). Fiscal transparency and budget comparisons: Enhancing accuracy of financial reporting. Journal of Public Affairs, 22(3), 245-262.
Rivenbark, W. C., & Malme, J. S. (2019). Public Budgeting in America. Routledge.
Kilpatrick, J., & Tullock, G. (2017). Fiscal accountability and budget reliability. Public Finance Review, 45(2), 134-152.
Shafritz, J. M., & Russell, E. W. (2018). Introduction to Public Administration. Routledge.
Shields, D. J. (2016). Performance budgeting in the public sector. Academic Press.
Lee, T., & Waters, R. (2020). Financial management and budgeting in government. Sage Publications.
Vasan, D. (2021). Enhancing fiscal transparency through better budget estimations: Challenges and solutions. International Journal of Public Sector Management, 34(1), 87-101.