Preliminary Operating & Capital Budgets
BY SUSAN LAIR, Phd - CONSULTANT, Executive Coach
During October and November, the Head of School and the Business Manager, CFO, begin planning the Operational and Capital Budgets for the next school year. Why October and November? Most schools issue re-enrollment contracts on February 1. The Preliminary Operating and Capital Budgets for 2024-2025 will go before the Board's Finance Committee in November for its first review and for the committee to make recommendations for change. The Finance Committee will present the updated Preliminary Budget to the Board at the December meeting. Remember, it's called the "Preliminary Operating and Capital Budgets" because everything in the budgets can change except the tuition! During December or January, the Board will lock in the tuition and vote on the Preliminary Operating and Capital Budgets. The Head of School and the Business Manager will work with the Preliminary Operating and Capital Budgets until September. By September, a school will know its enrollment for the school year and can vote to remove "Preliminary" from the final Operating and Capital Budgets.
What timing and activities should I expect?
October: The Head of School and the Business Manager review the Strategic Financial Plan and its goals for the next year with the Leadership Team. The leadership team (admissions, marketing, fundraising, division leadership, athletic director, facility director, and other managers) will begin to work on their part of the preliminary 2024-2025 operating and capital budgets.
November: Budget contributors complete their work by the first week in November. The finance committee reviews the strategic financial plan and goals with the Board and shares the first read of the preliminary 2024-2025 operating and capital budgets. The committee may seek approval at the Board meeting.
December: Preliminary budgets and recommended tuition rates are presented to the Board. The committee may seek approval at the Board meeting.
January: The committee prepares for Board approval of the preliminary operating and capital budgets and the proposed tuition rates. The Board must approve the next school year's tuition rates before the school can mail re-enrollment contracts.
February: Re-enrollment contracts are mailed on the first business day in February. The Leadership Team works with the Business Manager to forecast end-of-year projections and refine 2024-2025 preliminary budgets.
March: Most enrollment contracts for new students are mailed by mid-March. The Leadership Team is working on the revised 2024-2025 operating and capital budget.
April: The committee reviews the revised budget. The Board Treasurer and Finance Manager advise the Board about the revised budget.
August: Using the revised preliminary budgets, the Treasurer reviews the actual results of the current year YTD versus the revised budget.
September: Staff completes their work on the final 2024-2025 budgets. By September, school enrollment for the year is set. If needed, the revised preliminary budget is adjusted. The Finance Committee Reviews the budgets. The final Operating and Capital Budgets will be presented to the Board for approval.