Checks Balances: Step by Step Chapter Budgeting

A budget is a tool that outlines your chapter's plans, in financial terms, over a set time period.

Every chapter needs a budget to plan and control expenses, but creating one can be daunting for those unfamiliar with the process. A budget does not have to be complex or time-consuming to create and manage, and you do not have to be a business major to construct one. A chapter budget can be prepared by the chapter advisor or by chapter officers and approved by an advisor. A good budget reflects your chapter goals, provides information for evaluating and adjusting chapter activities, and records financial data useful in planning for the chapter's future.

  • Preparing a Budget

    • A budget has two sections: income and expenses. The budgeting process begins with an estimate of income and expenses to give the chapter an idea of how funds will be allocated for the budget period. Use previous chapter financial records to determine appropriate estimates for your budget. When no previous data is available, try to slightly underestimate income and overestimate expenses.

    1. Start the income section with any previous balance carrying over from the last budget period. This is the current chapter account balance.

    2. Estimate and record expected income and the date it will be available. Some common chapter income sources include local membership fees, student activities allocation or line-item funding, T-shirt sales, and planned fundraisers.

    3. List upcoming chapter expenses such as regional/international travel, chapter T-shirts, printing newsletters or flyers, and refreshments for meetings.

    4. Review each item for accuracy and make any necessary revisions. Be sure there is room for flexibility in your budget. Do not let an unexpected expense or unsuccessful fundraiser send your chapter into overdraft!

    5. A chapter advisor should always approve the proposed budget. The chapter also may opt to have members or the officer team vote to accept a proposed budget.

  • Managing a Budget

    • Now your chapter has developed a final budget; however, the budgeting process does not stop there! A chapter may budget each semester or on a yearly basis, but, either way, the budget must be closely monitored throughout the budget period.

    1. Record all actual financial transactions (income and expenses).

    2. Compare the estimated budget to actual financial transactions regularly. Make adjustments as needed. For example, if your chapter planned to earn $500 from refreshment sales, and only earned $300, reduce a planned expense by $200.

    3. At least one month before the end of the budget period, review estimated and actual income and expenses to determine priorities for the next budget period.

  • Sample Chapter Budget
    • ESTIMATED ACTUAL
    INCOME
    Current Chapter Account Balance $200 $200
    Membership Fees $500 $600
    College Line-Item Funding $500 $500
    Fundraisers
    Chapter T-Shirt Sales $500 $475
    Fall Craft & Bake Sale $600 $625
    Spring Car Washes (2) $400 $390
    Total Income $2700 $2790

    ESTIMATED ACTUAL
    EXPENSES
    Regional Meeting $375 $350
    Induction Ceremony Supplies $150 $155
    Chapter T-shirts $150 $150
    Car Wash Supplies $50 $45
    Refreshments for Monthly Meetings $125 $135
    Newspaper Ad for Craft & Bake Sale $50 $50
    International Convention $1500 $1500
    Total Expenses $2400 $2385


    [Return to the June 2004 Golden Key Contents]