Budgets
Budget Requests
The University prepares an annual budget that is preceded by careful planning, is subject to established fiscal procedures, and is approved by the institution’s governing body, the Board of Trustees of State Institutions of Higher Learning (IHL Board). Budget planning and prioritization are continuous processes that include both the University’s internal budgeting process and the development of requests for state funding.
As part of the state budgeting process, the University participates in the preparation of the Mississippi Budget Request (MBR). The MBR is the formal annual budget request used to identify and justify funding needs for the upcoming fiscal year. It provides information regarding existing funding, anticipated expenditures, and requests for additional or revised funding. The University’s funding priorities are incorporated into the IHL system-wide budget request and submitted through the appropriate state budget process. The Joint Legislative Budget Committee (JLBC) considers these requests in developing its Legislative Budget Recommendation, which helps form the basis for appropriation bills considered by the Mississippi Legislature.
University’s Budgeting Process
The University’s internal budgeting process is an ongoing process that requires budget managers to continually evaluate the financial needs and priorities of their departments or units. Budget planning should occur throughout the year as needs are identified, priorities are established, and future operational requirements are considered.
Each year, generally in March or April, budget managers will be provided with specific instructions and timelines for preparing and submitting budget requests for the following fiscal year. These instructions will outline the information and documentation required as part of the formal budget request process.
Budget managers should keep in mind that budgeting is a continual process and should not begin only when the annual budget instructions are issued. The annual budget request serves as the formal documentation and submission of needs and priorities that should have been evaluated and discussed throughout the year.
As part of this process, budget managers should review their current budgets, anticipated needs, and priorities with their respective supervisors. Academic departments submit budget requests through their deans, while nonacademic departments submit budget requests through the appropriate President’s Cabinet member. Budget requests should support departmental objectives and be aligned with University priorities.
The Vice President for Operations and Chief Financial Officer is responsible for developing revenue projections and working with the Director of University Accounting to finalize the estimated total funds available for operations. These projections are based on retention rates, previous spending, revenue estimates, allocation of state appropriations, and other income sources. Rate requests for tuition, housing, and board plans are submitted to the IHL Board for approval as required by policy.
The University’s budget serves as an important planning and communication tool, allowing departments and operating units to identify their objectives and the resources necessary to accomplish them. Departmental input is therefore a critical component in developing the University’s overall operating budget.
Budget Manager Responsibilities
Once a budget is established, the budget manager is responsible for the ongoing oversight and management of the funds entrusted to the department or unit. Budget monitoring is not simply a year-end exercise; it is a continuing management responsibility throughout the fiscal year.
Budget managers should review their assigned budgets at least monthly and ensure that expenditures and revenues are recorded correctly. This includes reviewing transactions, payroll charges, purchase orders and encumbrances, revenues, and other commitments; identifying unusual, duplicate, unsupported, or incorrect transactions; and requesting corrections when necessary.
Budget managers must also look beyond the available balance displayed in Banner. Known and anticipated obligations that have not yet posted—such as remaining payroll, contracts, travel, invoices, PCard activity, and planned purchases—should be considered when determining whether sufficient resources will remain through the end of the fiscal year.
Expenditures must comply with the purpose and restrictions of the funding source as well as applicable University, IHL, state, federal, and grant requirements. Having funds available in a budget does not, by itself, mean that a proposed expenditure is allowable or appropriate.
Budget managers should promptly communicate projected deficits, revenue shortfalls, unusual transactions, or compliance concerns to the appropriate University office and initiate necessary budget adjustments or corrections. Early identification of financial concerns allows the University and the department more opportunity to address them appropriately.
Simply put, a budget manager should know what has been spent, what remains available, what obligations are still outstanding, and whether the department is on track to remain within its approved budget through the end of the fiscal year.
Appearance and Reasonableness Tests
For all potential expenditures, regardless of the source of funds, budget managers should apply both an appearance test and a reasonableness test when determining whether an expenditure is appropriate.
The appearance test asks: How would this purchase look to external constituents if it appeared on the front page of a newspaper?
The reasonableness test asks: Is this expenditure necessary for an employee to perform their job or for the University to carry out its normal business?
These tests should be used to help guide purchasing and spending decisions. Budget managers and other University employees should avoid both the appearance and the reality of poor management of University funds and should maintain appropriate documentation supporting expenditure decisions.
For proper separation of duties and internal control, purchasing requests should be initiated by an employee and approved by the appropriate supervisor.
Budget Management Resources
The following links provide useful tools and resources to assist budget managers in effectively monitoring and managing their budget