Preliminary Program Budgets outline the activities that will be undertaken on a program-by-program basis. These Budgets effectively implement the priorities established and approved by Band Council while meeting minimum program standards. Program budgets are costed plans. That means they not only establish what the program will do, but also estimates the funds required to carry out those activities.
Priorization is listing, in order of importance, the activities to be undertaken in the upcoming fiscal year. It means striking a balance between obligations to the funding agency and community, needs of the community, and the resources available to the Band Council.
Mandate Objectives are specific, achievable, and measurable goals that the Chief and Council wish to accomplish during their current tenure as political leaders in the community. Mandate Objectives are established to fulfill election promises, to address priority concerns and to set new directions. Mandate Objectives provide direction to the Band Manager and the Program Directors to take into consideration in developing their Preliminary Program Budgets.
A funding agreement is a document containing terms and conditions by which a transfer payment is made by the Crown to First Nations for delivery of programs and services. Funding agreements are negotiated with various government departments, often on a multi-year basis. Funding Agreements are legal documents through which a First Nation commits to deliver specific programs and services while meeting minimum program standards. Rules regarding the flexibility in the use of the funding, cash flow, and adjustment methodology are included.
The planning framework provides the structure that will facilitate decision-making in the organization. For fiscal planning, the planning framework will outline two major processes: one for matching revenues with expenditures; and the other for determining priorities between the program and service needs that almost always exceed available budgets.
Community accountability means direct communication with the people to provide information to and to receive feedback and input from Band Members. It provides an opportunity to discuss Band Council business in an open and transparent manner. Community Accountability is achieved through a number of processes including the Annual Report, the audit, and the Annual General Meeting (AGM).
Appropriations are the process of allocating anticipated revenues (see Revenue Forecast) to Band programs and agencies. Program Work Plans outline exactly how much money is to be transferred to each program and when.
Expenditure and Variance Reports are monthly or quarterly spreadsheets and summaries that give an up-to-date comparison between Revenue Forecast and funds received, and between appropriations and actual expenditures on a program by program basis (see Sample Expenditure and Variance Reports). The difference between budgeted numbers and actuals is called a variance. A summary report recaps the overall financial position of the First Nation as at specific dates in the fiscal year (generally monthly).
The audit is a formal, independent review of all Band revenues and expenditures for the fiscal year. It is conducted in accordance with generally accepted accounting principles. Essentially, the audit is a "report card" of the financial management and fiscal health of the First Nation.
Program Directors are accountable for the responsible management of their program within the budget as allocated. They are accountable to the Band Council for delivering programs in accordance with policy duly approved by Council or set out within a funding arrangement. They are also accountable to clients for the quality of service provided.
