Page 132 - Pantego FY22 Operating Budget

Modified Accrual Accounting – A basis for accounting in which expenditures are accrued but
revenues are accounted for on a cash basis. This accounting technique is a combination of cash and
accrual accounting since expenditures are immediately incurred as a liability which revenues are not
recorded until they are actually received or are “measurable and available” for expenditure. This type of
accounting is conservative and is recommended as the standard for most governmental funds.

Net Position – The residual of all other elements presented in a statement of financial position. In
governmental funds, net position is referred to as “Fund Balance.”
Objectives – New projects or programs that the departments anticipates developing and implementing
during the budget year.

Operating Budget – The plans of current expenditures and the proposed means of financing them.
The annual operating budget is the primary means by which most of the financing, acquisition,
spending, and service deliver activities of a government are controlled. The use of an annual operating
budget is required by law. Operating budgets are essential to sound financial management and should
be adopted by every government.

Ordinance – A formal legislative enactment by the governing board of a municipality. If it is not in
conflict with any higher form of law such as a state statue or constitutional provision, it has the full force
and effect of law within the boundaries of the municipality to which it applies. The difference between
an ordinance and a resolution is that the latter requires less legal formality and has a lower legal status.
Revenue raising measures, such as the imposition of taxes, special assessments and service charges,
require ordinances.

Other Financing Sources – Governmental fund general long-term debt proceeds, transfers in, and
material proceeds of fixed asset dispositions. Such amounts are classified separately from revenues.

Other Financing Uses – This category is used to report the following events and transactions of
governmental funds: (1) original issue discount on debt; (2) payments to advance refunding escrow
agent; (3) reclassification of demand bonds as fund liabilities; and (4) transfers out. Such amounts are
classified separately from expenditures.

Performance Budget – A budget that focuses upon activities rather than line items. Workload and unit
cost data are collected in order to assess the efficiency of services. Typical data collected may include
miles of streets paved per year, cost of paved streets per mile, tons of garbage collected per employee
hour or cost per employee hour of garbage collection.

Performance Indicators/Measures – Specific quantitative measures of work performed or results
obtained as an objective of the department. Examples include: miles of street swept, police response
time, etc.

Productivity Measures – Productivity measures should reflect how well a program is performing its
activities to meet the needs of the public and the organization. They should measure productivity,
effectiveness, efficiency or the impact of a service provided. While activity measures indicate “how
much” activity the division/department is performing, productivity measures identify “how well” the
divisions/department is performing.

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