Hi!
A little more about finance!
It is now end of the financial year here. Our project
director was quite happy yesterday. He informed everyone that they were able to
spend the amount of money that they intended to spend for this year. They gave
their final reports to Ministry of Agriculture and Finance Ministry. There is
no money left with the project.
The point is that our budgeting system is very traditional.
Recently, we introduced program based budgeting but still we widely use
traditional budgeting. In traditional budgeting, the budget of this year is
made based on the expenses of last year so if once could spend its entire
budget this year, will get the same amount of money or probably more for next
year. That’s why our project director was happy because he could demand more
money as he had already spent what is there in the project.
I still have that question in mind if really have to think
about budgets in that nature. I believe
efficiency and goal achievement should be a concern but not spending money.
Regards,
Javid 
Hi Javid, Very interesting post. It is very similar to how it used to be on many federal projects in the U.S. I worked for an engineering company that had federal contracts and you were expected to find some way to spend your entire budget so that it would not be cut the following year. I don't think that was a very efficient practice...and believe budgets are much more frugal these days. The city I am interning is currently working on budgets. The budget targets are to remain at the same level with emphasis controlling increased costs, not on wasteful spending. It sounds as though you are having an opportunity to see much of what goes on in government.
ReplyDeleteHey Javid,
ReplyDeleteThat is a good question to ponder. It seems as if the organization, rather than being concerned with the end result of creating the greater good for the community is more concerned with being able to obtain money for next years budget. It is difficult to contend with the what is the right choice. But in the end I guess everyone is making out better than they would have.
Yeah Viv, it is a great experience. I will be working on some HR related stuff next month and I am hopeful that I will learn a lot there too.
ReplyDeleteshawn, that is always the toughest part.
Yeah Viv, it is such a nice experience. I will be working on HR related stuff next month and I hope it will be as enriching.
ReplyDeleteShawn, that is the toughest part.