A nursing budget is a systematic financial plan that estimates nursing revenues and expenses over a set period of time. It is informed by analyzing past income and expenditures and projecting how revenues will cover estimated costs. Nursing budgets can take different forms depending on factors like the budget period, level of flexibility, and whether costs are estimated by program or department. The nurse administrator plays a key role in formulating the budget by consulting with managers, justifying funding needs, and ensuring client safety is not compromised by fiscal constraints.

1. BUDGETING
PRESENTED BY
OM VERMA
ASSISTANT PROFESSOR
RELIANCE INSTITUTE OF NURSING

2. INTRODUCTION

3. INTRODUCTION
• an estimate of income and expenditure for a set
period of time.
•
A budget is a financial plan that includes
estimated expenses as well as income for a
period of time. A nursing budget is a systematic
plan that is informed best estimate
by nurse administrators of nursing revenues and
expenses. It projects how revenues will meet
expenses and projects a return on equal or profit.

5. DEFINITION:
1. Nursing budget is a systematic plan that is an
informed best estimate by nurse
administrator of revenues and nursing
expenses.
2. Acc. To pfiffner and presthus
3. It is tool for planning monitoring and
controlling cost .it is plan that use numerical
data. To predict or for cost the activities of an
organization over a period of time ( work
employee.)

8. PRINCIPLES OF BUDGET
It should provide sound financial management
(observance of certain arrangements) focusing on the
requirement of the organization
It should focus on objectives and policies of the
organization
Budget requires that a program activities planned in
advance

9. • It should include coordinating efforts of
various departments establishing a frame of
reference for managerial decision.
• Setting budget target requires an adequate
checks and balance against the adoption of
too high and too low estimate.
• Budget period must be appropriate to the
nature of business or service and to the type
of budget
• Budget is prepared under the supervision of
the administrator or the financial officer.
• While developing a budget the provision
should be made for its flexibility

10. CLASSIFICATION OF BUDGET
• Incremental budget
• Open ended budget
• Fixed-ceiling budget
• Flexible budget
• Rollover budget
• Performance budget
• Program budget
• Zero base budget
• sunset budget
• sales budget
• Production budget
• Revenue and expense budget
• Cash budget
• Capital expenditure budget
• personal budget
• operating budgeting

11. 1. INCREMENTAL BUDGET
• An incremental budget is a budget prepared using a
previous period's budget or actual performance as a
basis with incremental amounts added for the
new budget period. .
• 2. OPEN ENDED
A financial plan in which each operating manager
present a single cost estimate for what is considered
optimal activity level.

12. 3. FIXED CEILING BUDGET
• The uppermost spending limit is set by top
executive before the unit and divisional
manager develop budget proposal for the
area of responsibility .
4. FLEXIBLE BUDGET ( elasticity)
• Several financial plan each for different
programmed activity (predict means future )

14. 5. ROLL OVER BUDGETING
• Forecast programme,revenues and expenses
for a period greater than a year, to
accommodate programmed larger than
annual budget cycle.
• annual budget cycle used for big program
1 year to greater to used for expenses.

15. 6. PERFORMANCE BUDGET
• . PERFORMANCE BUDGET: Allocates functions
not divisions(direct nursing care ,in service
education,nursing research,quality
improvement).

16. 7. PROGRAM BUDGET
• PROGRAM BUDGET: Where cost are computed
for a total program(group total cost for each
service program).
• Eg. MCH, FP, T.B. AIDS , Universal
Immunization Programme

17. 8. ZERO BASE BUDGET
• ZERO BASE BUDGET :Requires nurse manager
to examine ,justify each cost of every program
both old and new in every annual budget
preparation

18. 9. SUNSET BUDGET
• SUNSET BUDGET: Designed to “self destruct”
within a prescribed time period to ensure the
cessation of spend in by a predetermine date.
• 10. SALES BUDGET:
• Is starting in budget program, since sales are
basic activities which gives shapes to other
activities. Compiled in terms of quantity and
value

19. • Sales budget is a financial plan, which shows
how the resources should be allocated to
achieve forecasted sales. ... It is very
important to forecast the
accurate sales because the budget of other
departments is based on the sales budget.

20. 11. PRODUCTION BUDGET:
• PRODUCTION BUDGET: Aims at securing the
economical manufacture of production and
maximizing the utilization of production facilities.
12 . REVENUE AND EXPENSE BUDGET:
• Expressed in financial terms and take the nature of
Performa income statement for future. Shows the
item of profits and loss.

21. 13. CASH BUDGET
• CASH BUDGET: Prepared by way of projecting
the possible cash receipts and payments over
budget period

22. 14. Capital budget
• This involved purchase of building
major equipment which has long life
5 -10 year and is not used daily .
• C.T scanner , ventilators ,dialysis
machinery etc.

23. 15. personal budget
• It is the current staffing Patten ,number of
unfilled position and last year report can
provide institute .
• It included recruitment assignment lay off
and discharge of personal .

24. 16 .operating budgeting
• It is include daily expenses such as electricity
,water .repairs . Maintenance medical and
surgical supply .

25. BUDGETING PROCESS/STAGES
1. FORMULATIONSTAGE
2. REVIEW AND
ENACTMENT STAGE
3. EXECUTION STAGE

26. FORMULATION STAGE
Starts 6- 7months before the
beginning of the financial year for the
budget.
During this period, estimates are
obtained about funds needed, funds
available, expenses and revenues.
Analyze data of the previous fiscal year
and the year to date by chief nurse
executive , department heads and cost-
center manager.

27. REVIEW AND ENACTMENT STAGE
Prepare unit budgets
Present budgets for approval
Revise and combine into organizational
budget
Present to budget council
Revise and present to governing board
Revise and distribute to cost center managers

28. EXECUTION STAGE ( performance)
Direct and evaluate expenses and
receipts
The formulation and enactment stage
are planning activities. Execution of
the budget involves directing and
evaluating activity.
Revise budget if indicated

29. STEPS IN BUDGETING
Review the goals of the agency or hospital
to identify activities of highest priorities,
because these are most likely to receive
funding
Review the objectives of the existing
programs to ensure that achievement of
these objective will support agency
Existing programs are revised and proposed
programs designed to maximum goal
accomplishment.
Manpower ,capital and operating expenses
are computed for each program.

30. Alternative methods are identified
for realizing designated objectives
and price of each alternative is
determined
Comparisons are made to
determine which alternative is most
cost effective.
A budget request is developed
which details a fiscal plan for the
preferred program.

31. ROLE OF NURSE ADMINISTRATOR
Participation in planning budget
Consult and take assistance of his/her
subordinates in determining the needs
of the unit for ensuring year on the basis
of information received
Request sufficient funds to suggest a
sound program
Submit budget request with
justification with proposed expenditure
When the budget is allotted the
administrator should support the budget

32. ROLE
Is knowledgeable about political, social and
economic factors that shape fiscal planning in health
care today
Demonstrates flexibility in fiscal goals setting in a
rapidly changing system
Anticipates, recognizes and creatively problem
solves budgetary constraints
Influences and inspires group members to become
active in short and long range fiscal planning

33. Recognizes when fiscal constraints
have resulted in an inability to meet
organizational or unit goals and
communicates this insight
effectively, following the chain of
command
Ensures that client safety is not
jeopardized by cost constraints
Since she is responsible for budget
she should cover the routine budget
control

34. ASSIGNMENT

35. ANY
DOUBTS
ANY
DOUBTS???????

36. LET’S
SUMMARIZE