Budgets
In budget planning, public administrators need to outline expenditures related to operational and capital budgets. In public administration, operational budgets are defined as day-to-day expenditures of a government while capital budgets refer to long-term investments for an organization. When creating budgets, public administrators are faced with the need to determine priorities for capital and operational budgets because of limited funding. The determination of priorities for operational budgets and capital budgets are affected by some factors, which are applied in the budget cycle. Similarly, capital budgeting process is affected by some factors that are applied in each budget cycle.
The most important factors that can affect the development of priorities for operational budgets relate to the three objectives of public expenditure management. In this regard, fiscal discipline, operational efficiency, and strategic resource allocation are important factors that influence the decision making processes of public administrators on priorities for operational budgets. These factors play a critical role in determination of priorities since they are the premise for public expenditure management. Additionally, these factors shape the link between policy and budgeting for both the immediate and long-term future (World Bank, n.d.). In public administration, operational budgets are based on public expenditure management,...
References
Schönbohm, A. & Zahn, A. (2012). Corporate Capital Budgeting: Success Factors from a Behavioral Perspective. Retrieved March 28, 2019, from https://www.econstor.eu/bitstream/10419/68243/1/733746489.pdf
World Bank. (n.d.). The Budget Preparation Process. Retrieved March 28, 2019, from http://www1.worldbank.org/publicsector/LearningProgram/PEAM/DorotinskyBackCh4.pdf
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