Budgeting Basics and Beyond

24.14. Budget Participants

Preparation of the budget tends to involve just about anyone of importance who is associated with a nonprofit entity, including community representatives, funding sources, and regulatory agencies. These external parties have different backgrounds and often have different budget expectations. A nonprofit organization must respond directly to these external forces, which often have conflicting objectives that make it difficult to manage and plan the organization's future. Internal budget participants may also have different goals. Professional concerns for the quality of service often tend to override issues of cost. Financial managers of nonprofit entities often have a different background from that of others in the organization and may set financial priorities that are at variance with the interests of the professionals. The budget often is a compromise between various conflicting internal parties.