Specific Guidance on Budget Management Responsibilities and Actions in Faculties and Academic Departments

1. Budget Monitoring and Reporting Responsibilities

Role of the Vice-President and Head of Faculty

  • Be responsible and accountable for allocated financial and capital resources in line with agreed financial and other policies
  • Work with Heads of Departments/Schools to achieve agreed income and other targets across a portfolio of activities
  • Work with the Faculty Management team to determine the local model for resource allocation, oversee its operation, approve and monitor the budgets of Departments/Schools and exercise control over post releases

Role of the Director of Faculty Operations

  • Manage appropriate budgets and people as agreed

Role of Head of Faculty Finance

  • Gain an overall view of finance for the Faculty and for all non research activities
  • Provide regular (monthly / quarterly or otherwise as required), accurate, transparent financial reporting, monitoring, budgeting and forecasting information to both Faculty and Central Finance Management
  • Work closely with the Finance Department in providing information for the University’s Management Information pack, interpreting data and providing commentary on Faculty financial performance to senior University management

2. Principles of Budget Monitoring and Reporting

  • Faculties are responsible for the economic, efficient and effective use of budgets
  • Responsibility for budget management may be delegated by the Faculty Pro-Vice Chancellor to individuals within the faculty. An individual with delegated budget responsibility then becomes the budget holder and will be totally responsible and accountable for that budget
  • Where budget responsibility is delegated to an individual the management and financial responsibilities should be aligned such that the budget holder is accountable for the financial implications of their management decisions
  • Budget holders must ensure that the actual financial results are compared to the budget on a regular basis. This is essential not just to verify income and expenditure against planned levels, but also to identify changing patterns or circumstances that may give rise to the need for management action or changes in policy
  • Regular monitoring of both income and expenditure should take place and the results of such monitoring should be appropriately documented
  • 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
  • Budget monitoring data should be used in the process of out-turn forecasts to ensure that corrective action can be taken to address budget variances in a timely manner

2.1 Comparison of Actual Financial Results to Budget

  • The frequency of comparing actuals to budget will depend on the size and complexity of the budget. In the majority of circumstances budget monitoring should take place on a monthly basis, but as a minimum this should be undertaken on a quarterly basis
  • The objectives of the comparison are as follows:
    • To detect changes in circumstances that are impacting on the department’s financial performance against budget
    • To measure financial performance
    • To discover transaction errors
    • To ensure that expenditure is reasonable and necessary to achieve the department’s objectives
    • To ensure that expenditure is in accordance with the Financial Regulations and that transactions are adequately supported
    • To inform out-turn forecasts
  • The comparison should be documented and when actual results vary significantly from the budget a budget holder is expected to determine the cause, evaluate the activity and take corrective action. This should be discussed with the Head of Department and the agreed action documented
  • The results should be reported upwards to an appropriate level and in an appropriate manner for the Faculty Executive Board
  • The monitoring data should be fed back into the planning cycle to assist the following years’ budgets

2.2 uBASE Budget Reports

There are a number of reports in uBASE that can help you with the monitoring of expenditure against budget. Information on the reports is available in the Reports Catalogue

3. Virements

  • Virements refer to the movement of budgets between cost centres. The movement of budgets may take place within a department, between departments, within a faculty or between faculties
  • Where budget virements have been authorised there should be formal evidence of this by the Head of Department (or nominee) and a record held within the Department for potential review by Auditors or other staff in the event of a query
  • Further information on virements can be found on the Finance Department web pages in the Good Practice Guide for Financial and Budget Management
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Need Help or More Information

Who to Contact
A Finance Manager supports Academic Departments with queries relating to departmental expenditure and budgets for non-research activities. Research Finance provide support for academic departments for research activities.