Budget Tracking In Cities And Towns

Municipalities are an interesting group for financial students to study

. The calculations needed to determine what money can be spent for which project isn't always as cut and dried as the media makes it out to be. If a bond is raised for capitol improvements in a school district, that money can only be spent on buildings. While some citizens think that money should not be spent for buildings when teachers are underpaid, an amount of the funds given to school districts and other government bodies must be spent on building repairs and the other projects it is allotted for, not the ones that are popular.

Strict accounting of funds spent and handles by each office and clerk in a governmental position can help ensure that embezzlement does not occur and that a record is available in the eventuality of an audit. The Internal Revenue Service is particularly strict about funds spent from money raised from tax exempt bonds. These bonds are subject to reviews every five years in addition to random audits generated through the Service.

Crossover in different fund accounts cannot co-mingle or be combined. This sounds more difficult than it is, if a strict accounting is made. We are blessed to live in a time where software takes care of much of the hard number crunching. For several centuries, clerks processed the account books in different municipalities around the world. From Japan to China to Europe and even in the Mayan Empire, bureaucrats had to keep track of how the money was spent that they were allocated. Every empire needs to know how their money is spent, from Rome to your local Parks and Recreation.

Public servants have the greatest responsibility to track and account the taxes collected and spent by their offices. Misuse of public funds is a crime, even if it is unintentional. Minding the business takes a new meaning when you must account for each penny spent. A system that offers a new look at an old business gives a better accounting using new tracking ability. Every city and town has different departments with different accounts to track and balance.

While having a year end surplus is considered a good thing in tough times, it still must be accounted for and explained. The ability to 'trim' a budget is something that is a desirable feature in a city and department manager. Government accounting software gives greater ability to trim budgets accurately.

by: Art Gib

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