HomeMy WebLinkAbout2018-PAD-025 Approval, Funding & Reporting of Budget Variances
COUNTY OF NEWELL - POLICY HANDBOOK
POLICY NO: 2018-PAD-025
TITLE: APPROVAL, FUNDING & REPORTING OF BUDGET VARIANCES
ADOPTED: July 19, 2018 (C-218/18) SUPERCEDES NO: 2008-PAD-025
TO BE
REVIEWED: 2021 PAGE NO: 1 of 2
POLICY PURPOSE:
In accordance with the Municipal Government Act the County may only make an
expenditure that is:
a) Included in a budget, or otherwise authorized by council;
b) For an emergency; or
c) Legally required to be paid
This policy provides guidance for authorizing, funding, and reporting expenditures
that have not been included in a budget or approved by separate resolution of
Council.
DEFINITIONS:
Manageable Variance: a budget variance that can be absorbed within the approved
budget without affecting service levels.
Negative Budget Variance: actual expenditures in excess of approved budget.
GUIDELINES:
The County prepares an annual budget. Directors and Managers are expected to
operate within the approved budget of the individual functions they manage.
Negative Budget Variances requiring additional funding must be approved by either
the Chief Administrative Officer or by County Council in accordance with approved
thresholds.
Significant changes to service levels provided by the County (increase or decrease)
and increases to permanent full-time equivalents (“FTEs”) must be approved by
County Council.
COUNTY OF NEWELL - POLICY HANDBOOK
POLICY NO: 2018-PAD-025
TITLE: APPROVAL, FUNDING & REPORTING OF BUDGET VARIANCES
ADOPTED: July 19, 2018 (C-218/18) SUPERCEDES NO: 2008-PAD-025
TO BE
REVIEWED: 2021 PAGE NO: 2 of 2
PROCEDURES:
Where budget variances are manageable without affecting service levels:
When it is anticipated that a general ledger account will be over-expended in an
amount exceeding $2,500, the department head shall make a request to the CAO by
email, for approval to over-expend that account. The request must state:
1. The dollar amount of the over-expenditure and why it will occur; and
2. Whether the over-expenditure can be funded through reallocations from
another account or accounts within the approved budget, and if so, the
amount from each account that will be used to make up the difference.
The CAO may authorize general ledger account over-expenditures using the following
criteria:
1. There is room in the accounts that are to make up the difference;
2. The total approved budget will not be over-expended;
3. The over-expenditure is necessary; and
4. There are no significant changes to service levels.
Where anticipated over-expenditures cannot be funded through reallocations from
other accounts within the approved budget the CAO may authorize up to $75,000 of
additional spending in a fiscal year with funding drawn from an appropriate restricted
surplus fund. Council must be notified of these expenditures, in writing, at their next
regular meeting.
Where budget variances are not manageable without affecting service
levels:
If the over-expenditure is not manageable under the criteria above, or if the CAO is
not satisfied that the over-expenditure is necessary, the request must be forwarded
to Council for their consideration. If Council approves the over-expenditure, the
motion affecting the over-expenditure shall also state the source of the funding.
REPORTING:
Approval of budget variances and additional spending shall be forwarded to the
Manager of Finance for inclusion with the quarterly financial reporting provided to
Council.