Lesson 1 – 10-Step Budget Checklist

This 10-step budgeting checklist helps guide you through the budgeting process. It typically needs to begin at least three months before the end of the fiscal year to to give the approval process enough time. The budget is approved by the board of directors before the start of the new year.

  1. Timeline
    • Schedule target date for board approval
    • Factor in time for each step
    • Approve before beginning of fiscal year
  2. Goals
    • Prioritize program delivery goals
    • Set financial goals
    • Be specific about annual goals based on strategic plan
  3. Review current fiscal status
    • Review current year income and expense compared to budget
    • Forecast to the end of year
    • Analyze and understand variances
  4. Budget approach
    • Assign roles and responsibilities
    • Agree on authority to make decisions
    • Agree on how much unknowns can be included
  5. Draft expense budget
    • Determine costs (expenses) to achieve program goals
    • Project new income based on new activities
  6. Draft income budget
    • Project income based on current fundraising and revenue activities
    • Project new income based on new activities
  7. Review draft budgets
    • Verify that the draft meets program and organizational goals
    • Review and discuss all assumptions
    • Make adjustments based on goals to match income and expenses
    • Review final draft for all goals and objectives
  8. Approve budget
    • Present to committees
    • Present to board for approval
  9. Document budget decisions
    • Create consolidated budget spreadsheet and file
    • Write down assumptions
  10. Implement budget
    • Assign management responsibilities
    • Incorporate into accounting system
    • Monitor and respond to changes as needed