Month End Reporting

Regular monitoring of expenditure is essential; not just to verify expenditure against target but also to identify changing patterns or circumstances that need corrective action.

You should have procedures in place within your department to monitor progress against budget and objectives at regular intervals (generally monthly). In addition, appropriate reporting and authorisation mechanisms should be in place.

To monitor expenditure, the types of information you need include:

  • budget for the area of activity for the full year and profiled for the year to date. When profiling the budget, planned expenditure patterns should be considered. For certain types of expenditure (particularly non-staff costs) it is likely that expenditure will peak and trough at particular points in the year.
  • actual expenditure to date
  • future expenditure commitments
  • balance of annual budget remaining. When actual expenditure and commitments together are compared to the full year budget, this will indicate the balance of budget remaining at the review point.
  • forecast outturn. This is the expected position against budget at the end of the year after taking into account all anticipated expenditure. The forecast outturn may not be equal to the original budget.
  • analysis and explanation of any positive or negative variances when comparing expenditure and forecast outturn to budget, together with a documented action plan in order to address adverse variances.

There are reports in SAP that can help you with the monitoring of expenditure against budget. Please contact your Management Accountant for further information.

The monitoring of expenditure against budget should be regularly undertaken at an overall level by the Head of Department and, where appropriate, at a more detailed level by the individual budget holders.

Meetings between the Head of Department and the individual budget holders should be held at regular intervals (ideally monthly) and any actions identified should be formally documented and agreed.

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