As a compulsory best practice, agencies and departments in any business enterprise must manage their annual appropriation. This is important in order to be able to deliver products and services efficiently, in compliance with government regulations. Therefore, departments must possess a sound budget management and development system. Additionally, there will be need for best practices to integrate internal budgets with business processes.
In addition to this, according to the Audit Act 1994, Section 16AB business enterprises must submit a report of their audit to the parliament. In order to ensure compliance with this, the government sector has two recommended budgeting processes. These include:
This process is hinged on the submission of budget tenders or bids. These bids are submitted to the government by the budget development department of the organization. This is a two step process:
Step 1: The best practice of updating forward estimates every November in order to input it in budget planning. As part of best practices, the treasury and finance department must seek information to assist with the process.
Step 2: The treasury and finance department must present a brief to the government about its output (products and services). It must also include assets in the reports. This will facilitate the government to consult with special interest groups and broader communities before concluding its stand on the proposed budget.
The final decision is dependent on cabinet approval, which depends on annual state budget and departmental budgets.
When an audit department focuses on internal budgeting, it must focus on the level of training and education of employees. In addition to these business best practices, auditors must focus on the following:
Here are some recommendations for budget development and Management within departments:
Conclusively, compliance with these practices involved in budget development and management within departments, is compulsory for a professional business setup.