Budget Proposal..Final..14.3.11
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DEVELOPING BUDGET PROPOSAL
INTRODUCTION
Budgeting though primarily recognised as a device for controlling,
becomes a major part of the planning process in any organisation. Budget is
the heart of administrative management. It served as a powerful tool of co-
ordination and negatively an effective device of eliminating duplicating and
wastage. Nowadays, the nursing budget can account for up to 90 % of the
organisations total expenses , therefore , participation in fiscal planning is
viewed as a fundamental and powerful tool for nursing.
DEFINITION :
1. Budget is defined as an estimation ofcosts, revenues, and resources over
a specified period, reflecting a management's reading offuturefinancial
conditions.
2. Budget is asumofmoney allocated foraparticular purpose.
3. Planning the financial operations of a business is called budgeting. A
budget is a written financial plan of a business for a specific period of
time.
IMPORTANCE OF BUDGET:
Budget is one of the most important administrativetool, which is
important in the following categories.
(1) Plan ofaction for achieving quantified objectives
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(2) Standard for measuring performance
(3) Device for coping with foreseeable adverse situations.
PURPOSES OF BUDGET
A budget serves five main purposescommunication, coordination,
planning, control, and evaluation.
Communication
Coordination
Planning
Control
Evaluation
Other purposes like:
Emergency Fund
Achieve Goals
Organization
Spending Habits
PREPARING A BUDGET FOR A UNIT
I. BUDGET WORKSHEET
Budget worksheet that explains budget adjustments. The work sheet
depicts information by the account number and sub code of each centre and
lists prior - year expenses, original budget and annualised expense. This
form usually is provided during the new budget formulation stage and the
annualised expense is the projected total expense if current rates continue
to the end of the fiscal year.
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OPERATING EXPENSES
Subcode
Description Prior yearexpense
Originalbudget
Annualisedexpense
Budgetadjustments
Approved budget
6000 Total supplies
6100 Forms
6200 Books
6434 Brochures6660 Film rental
Total supplies
8000 Total repairs & maintenance
8200 Main & repair
8310 Minor equipments
8524 Telephone
Total repairs & maintenance
9000 Total - OCE
9200 Travel9300 Airfare
9600 Entertainment
Total other controllable
Account Total
Total
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II. BUDGET FOR A HEALTH CARE ORGANISATION
Every hospital prepares the hospital health care complex cost
report certification and settlement summary, commonly known as the
Centre for Medicare Medicaid ( CMS ) cost report.
For preparing budget to a unit , note that ICUs are grouped as adults
and paediatrics .
To separate these units for revenue and expenditure, make the
following calculations.
1. Select a client care unit of a hospital
2. Determine the number of client days of occupancy for this unit.
3. From the Medicare cost report determine
3.1.Total direct & indirect costs ------------------
3.2. Total client days ------------------
3.3. Divide the total direct and indirect costs -------------------- by
Total client days ---------------- = cost/client day.
Client days for unit ( from 3.2 ) -------------- x 3 cost /client day
( from 3.3 ) -----------------= ------------------ or approximate expenses
for the nursing unit for this year.
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HOW TO DEVELOP A PROPOSAL BUDGET
Proposals can be costly
Proposals are not cheap; they can cost thousands of dollars. The real
danger lies in the fact that proposal costs are usually hidden, buried in
overhead. The proposal coordinators, graphics specialists and technical
staff often do not charge to a specific job number, and their efforts can
get lost in the blizzard of numbers that go along with running a business.
But the money is real. You are going to spend actual bucks preparing a
proposal, even if you dont really see the bucks being spent. proposals
cost anywhere from thousand to lakh or more, especially if a follow-on
interview is involved. If you dont track these dollars, youll never have a
good measurement of how well you are doing in your proposal efforts,
other than your win-loss record.
And this doesnt really tell the tale, either. With no proposal budget, its
often easy to spend the same amount of money on a winning proposal
with a small return (low value) as you would on a losing proposal with a
high value. If you dont track proposals costsand make smart business
decisions about where you ought to be spending your moneyyou could
end up with a terrific win rate but with projects that dont quite pay the
bills.
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How much should you budget for a proposal?
Thats a hard question to answer; it really depends on how
important the project is to the firm. As a general rule proposal costs
usually run between 3% and 5% of the value of the contract. But we can
only discover what it takes to write proposals at your firm by
scrupulously tracking the costs of each proposal you write.
The amount of time it takes to write a proposal varies widely. If you are
prime on a project, your time commitment is naturally going to be much
higher than if you are subbing. If the proposed project is complex, then
your proposal will likely require specialists from a variety of fields; this
drives up the total number of hours (and thus the cost) it takes to
prepare.
Chief Factors In High Proposal Preparation Costs
Regardless of the type of proposal or its size or whether youre the
prime or the sub, proposal costs rise when the following conditions are
in force.
Pre-proposal conferences.
No page limit specified in the solicitation.
No page limit given to the writers.
Principals deeply involved in the writing process.
No clearly defined project approach before the solicitation arrives.
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No project team assembled before the solicitation arrives.
Lack of a proposal development schedule.
Sitting on the solicitation for too long.
No clearly defined-and enforced-deadlines for proposal drafts.
No pre-defined limits for art developed, including the cover.
Each of these are discussed in greater detail here.
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Example For Budget Proposal
Estimated Budget for Male surgical concession General Ward for the year 2011-12
Bed strength : 60
Average patient stay : 05 days
Average bed occupancy: 20 patients
Bed charges per patient per day: Rs. 150
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Itemno
Charges Income Expenditure
1. Bed charges
Doctors charges
Nurses charge
15025365 = 13,68,750
2. Man power
Ward in-charge
Staff nurses ( > 2 years)
Trainees ( newly appointed)
Group D workers
- Permanent
- Contract basis
18,0001 12= 2,16,000
130001212= 18,72,000
5,000312 =1,80,000
10,000312=3,60,000
3,000612= 2,16,000
3. Inventory items 9000 12 =1,08,000
Total Rs.13,68,750 Rs.28,44,000
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CONCLUSIO N:
A Budget is a quantitative statement and a complete financial
forecast based on available data about the financial condition of the
agency or hospital during the forthcoming year. However, in a view of
changing circumstances in India are required to evolve a flexible plan to
suit different circumstances instead of relying on rigid plan of budget.
BIBILIOGRAPHY
1. BT BAsavanthappa. Nursing Education.1st edition. New Delhi: Jaypee
Brothers publishers:2003. p. 306 15 ,486
2. http ://www.mohfw.nic.in
3. http ://www.tpub.com.
4. http ://www.ericdigests.org/pre-9219/higher.htm
5. www.pingpong-online .de/osc/
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