Section 3: Reference Materials

Reference #15: Budgeting

Budget Categories

Different organizations often have different budgeting and accounting categories. Usually, costs can be broken down into three categories: personnel costs, travel expenses and other. Sometimes a fourth category, overhead, is added.

1. Personnel costs – salaries, fees, wages, honoraria, (principal investigator, project director, coinvestigator, senior or professional staff, coordinator, manager, trainer, consultants, assistants, technicians, secretary, etc.)
   
   
2. Travel Expenses (transportation, lodging, meals, registration fee at conferences or workshops, fieldwork)
   
   
3. Other (supplies, equipment, photocopying, communication, laboratory fees, office expenses, animal purchase and care, computer supplies, printing and copying, educational and instructional materials, audio-visual, graphic arts, photography, library, database searches, equipment maintenance, costs of publishing; advertising, telephone, fax, postage, packaging, handling, reference books, journal subscriptions, rental fees (equipment, meeting room), moving, shipping, training, testing, providing refreshments or meals
   
   
4. Overhead costs (rent, utilities). The current most popular procedure when bidding on external projects is to include overhead in the “charge out rates of personnel.” Under this practice, the daily rate for personnel is “marked up by a certain percentage to cover overhead expenses. The alternative is to include a separate line that states overhead at a specific rate, e.g. 10 or 15 percent of fees and/or other anticipated project expenses. The method used by the organization will depend on the internal practices of the organization, as well as the requirements and expectations of the funding agency.

Management Costs and Program Costs

Often organizations and funding agencies require that a distinction be made between project management costs , and program costs. The expectation is that the costs of managing the project should be reasonable when compared to the value of the benefits.

1. Management Expenses. These are the costs that the organization incurs in planning, managing program implementation, and monitoring the project. The categories of management expenses are similar to those listed above: personnel costs, travel expenses, other and overhead.
   
   
2. Program Expenses. These are expenses directly related to the services provided to beneficiaries, and the benefits received by beneficiaries. They include:
   • Personnel (fees paid to employees of the organization, consultants or other organizations to provide direct services to beneficiaries, e.g., training, educational programs, technical assistance, health care, etc.)
   • Beneficiary Allowances (training allowances, fees or honoraria paid to beneficiaries);
   • Travel Expenses related to providing direct services, or beneficiary travel
   • Other (training materials, workshop expenses, supplies and equipment purchased for beneficiaries)

Internal Funding and In-Kind Contributions

Sometimes donors or funding agencies ask organizations to break down the budget to show what the organization will contribute, and what the funding agency will contribute. In some instances, the contribution of the organization is a financial one, in others the organization contributes time or other important resources.

Example of Template for Developing a Budget

Activity Set	Personnel	Unit Price	# of Units	Amount
1.Activity #1 Example. Establish and support gender committees to work with local government officials to bring more women into the local planning and decision-making process.	Personnel	Rupees		Rupees
	1. Project Manager	2,000	11	22,000
	2. Research Officer	1,500	20	30,000
	3. Short-term Advisor	1,500	26	39,000
	4. Committee Clerical Support	500	50	25,000
	Total Personnel Activity #1		46	116,000
	Travel
	1. Trips between A and B via C	200	10	2,000
	2. Accommodations		Nil
	3. Meals while traveling	200	10	2,000
	Other (list specifics)
	Meeting Expenses	5,000	5	25,000
	Supplies			3,000
	Communication			3,000
	TOTAL ACTIVITY #1			151,000
Activity #2 (specify)	as above
Activity #3 (specify)	as above
etc.
Activity #X: Project Management	As above

 « Previous | Next »

Get Adobe Reader