Community Centre Budget

Community Centre Budget

Question No. 1

The financial report for the third quarter for 2011-12 showed an overspending. What possible explanations are there for how this occurred?

The financial report for the third quarter of 2011-12 showed an overspending in four major cost centre heads for staff and three major cost centre heads for categorization of expenditures in non-staff activities. Overspending for the third quarter is more than the overspending in previous quarters. These include higher actual expenditures for the manager, admin support staff, outreach workers, and training of staff. Actual expenditures exceeded by 360 for manager staff; actual expenditures exceeded by 610 for admin support staff; actual expenditures exceeded by 360 for outreach workers staff and by 200 for training of staff. Expenditures for managers are increasing continuously every quarter. Overspending on managers is due to higher allowances and benefits that are given in the form of fringe benefits (such as meals when sitting late in office, hi-teas in meetings, etc.). Another possible reason for higher overspending on managers is due to excessive travelling by the managers. They might have been involved in heavy commuting in the third quarter, which resulted in continuous increase in expenditure.

Admin support staff budget has shown static overspending of 610 in every quarter which shows that budget was incorrectly estimated. Outreach workers overspending has increased from second and third quarter with the same amount that is due to overtime working hours due to workload management from second quarter onwards. Training budget shows variation due to additional training need that arises from time to time. Therefore, this expenditure is not constant across the quarter.

When it comes to non-staff expenditures, major variation is reported for the rent expenditures that exceeded by 120 from the budgeted standard set at the level of 2400 for every quarter. This represents wrong estimates in budget for rent expenditure. Secondly, heat and light expenditures also showed an underreported variance of 80 with continuous variation in every quarter. Main reason for increase in the heat and light expenditure is due to changes in the fuel adjustment charges in the electricity bill. Another factor of increase in the heat and light expenses from the budgeted amount is increase in the elder people visit in late working hours that increased the heat and light expenditure.

Travel and subsistence also reported an overspending of 110 pounds that resulted in creating an actual expenditure of 210 pounds as compare to budgeted estimates of 100 pounds for the third quarter. This is due to expansion of the outreach workers activities to increase Bangladeshi elder's contact that included providing meals and travelling items along with vehicle maintenance expense for outreach workers. These factors resulted in increasing the budget deficit for the third quarter.

Question No. 2

Could any changes have been made in the last quarter to deal with the anticipated end of year deficit?

In order to deal with the anticipated end of year deficit, changes could have been made in terms of reducing the cost of staff and controlling ...