Performance budgeting system
- Provide governing body members and the public with better information on quality of service and also improves program efficiency.
- It allows for better evaluation of results of program operations.
- Focuses attention on efficiency and effectiveness but not fundamental questions like how best to allocate limited resources.
- Its complex as more information must be provided.
Program budgeting system
- Managers have flexibility to achieve service level targets.
- The system is usually accompanied by measures for output.
- It emphasizes on quality and costs of service as opposed to the cost of things purchased.
- It’s oriented on a lot of paperwork and analysis.
- It’s a very complex system to use.
- Determining the current service budget is subjective.
Line-Item budgeting system
- The more details the objects of expenditure, the greater the governing body’s control over the department.
- Provides details on resources only and not what will be accomplished with the resources.
- It’s very familiar in that, the governing body members may not want to change the budget system because of a concern for getting less information.
- Uses incremental approach thus issues like how to reduce costs is not dealt with.
- Little documentation as a request is given relative priority.
- The more detailed the items, the less flexibility the managers have.
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Kay Spearman, Financial management for local government, Google books results http://www.books.google.co.ke/books?isbn=1844074021