Theme 6: Significance of Budget and Budgetary Control

The sixth theme discussed the significance of budget and budgetary controls to non-profit
organizations.

LIPUMA OF AKLAN IRRIGATORS ASSOCIATION, INC.

They conduct monthly meetings in which the money spent and received are shown in the
meeting for the members to see where did the funds go. The president/chairman also added:

“ We make sure that we only spend the money needed for the project”

They use budget information for them to have a guide when making decisions.

For them budgetary control is helpful to allocate their funds rights.

The president also added that the budgetary control guide their organization to achieve their
goals and objectives.

“If there is a budgetary control there is a big chance that the goals and objectives will be
achieved because it is aligned on what to do with the funds.

TINAGONG DAGAT FISHERFOLKS ASSOCIATION (TDFA)

As to the general manager transparency in the organization is important and also they track their
spending.

“The transparency is important when it comes to budget and financial aspect especially how the
money flows. We have monthly meeting and one of our agenda is financial disclosure, the cash
inflow and outflow of money. We give importance into transparency because without it, it can
ruin the trust of each other and it is one key to have a good governance.”

“We track our spending, and we have records of our monthly expenses. We need to be
transparent; even in small amounts, We record it. We always plan for the next month's budget;
make strategic plan; talk about what we need to spend, where to get the budget, and who is
needed to attend the training.”

Because they lack budget, According to the general manager they allocate the money monthly
before deciding how much they should spend for the month. If the budget is too tight and they
have important expenditures, they need to plan where and what activities they need to do to earn
the money.
“Through budgetary control, it makes the organization transparent when it comes to the financial
aspect because we can track the cash inflows and outflows, and it can also help us make strategic
plan to decide what we must do to continue the operation and if our funds can still support our
daily expenditure” the general manager said. He also added that budgetary control guide their
organization to achieve their goals and objectives:

“One of our objectives is to have transparency because it leads to good governance. And
budgetary control helps the organization become transparent in terms of finances; therefore, we
achieve our objective.”

KALIBO MIGRANTS SUPPORT GROUP

According to their representative which is a CPA, internal control is needed in order to prevent
internal collapse. The representative also added that the cost justifies the needs and/or benefits,
for their organization to have its capacity to help. To prevent fraudulent acts they use budgetary
control in their organization. And lastly the representative said that they use budgetary control to
guide their organization to achieve their goals and objectives through non-monopolization of
funds.

AKLAN BAGHAY, INC.

In Aklan Baghay, the president said that in their organization there should be no secret,
everything must be transparent. He added that during meetings every members of their
organization can see the funds that their organization spent. The president of aklan baghay also
said:

“Here in Aklan Baghay we don’t have annual dues unlike other organization they have.”

According to the president of aklan baghay, they use budget information in making decisions,
they first allocate funds before accepting the project to see if it can meet the needs of the project.
The president further added:

“You must analyze the funds if it is enough or not. Because we have proposals and projects and
then we look at what we prioritize that the budget can afford. It’s difficult to jump right away if
you know that the budget is insufficient. Not like other organizations that have sufficient funds.”

PHILEXPORT AKLAN CHAPTER INC.

The executive assistant of PhilExport in Aklan stated that:

“according to the board resolution all the members should sign all the papers needed for the
projects. We conducted series of meetings, it enable us to discuss decisions on how to effectively
apply budgetary control measures on the said project.“

Their organization use budget information also have a guide in making their decisions. The
executive assistant then added the role of budgetary control:
“Sometimes, the members have different perspective about the business, the decision of the
board for the allocation of funds is based on the majority of votes, we secure that the proposed
project is eligible and not for personal use only.” Furthermore, the assistant said that they use
budgetary control to guide their organization to achieve its goals and objectives they need to save
and earn profit for their expenses.

“Supposedly, we have unending generating activity of the organization. Aside from

exhibits, partnership of Department of Trade and Industry and government, our allocated funds is
necessary to continuously operate itself, without the need of financial assistance. “

ROSARIO MULTI-PURPOSE COOPERATIVE

In Rosario MPC, they conduct general assembly yearly and in that assembly they report all the
funds to the Board of Trustees. Rosario MPC also uses budgetary controls in making decisions
and added its role to the organization: “The role of budgetary control is to make sure that the
funds are aligned to the proposed budgets and that the objectives of the organization has been
achieved.” Lastly, Rosario MPC uses their budget based on the allocated funds in the budgetary
proposal, it shouldn’t exceed more.

INTEGRATED BARANGAYS OF NUMANCIA (IBON) MULTI-PURPOSE

COOPERATIVE

According to IBON MPCs member of the board of directors: “I am aware of how the fund is
used and that we should not use it for personal expenses. We should not purchase the item if it is
not in the budget. The majority of the board should have to approve it.” The member of the BOD
also added that they also use budgetary control in making decisions and that their targeted
expenses and surplus really happen because of budgetary control. “We achieve the surplus that
we targeted, which is for the beneficiaries, specifically the members, scholars, donations, and
other projects of our organization.”

CBCP MULTI-PURPOSE COOPERATIVE

The bookkeeper of CBCP stated that “Since, I am the bookkeeper and get information on every
transaction I am aware of how money is spent.” They use budgetary control to allocate their
funds and the bookkeeper did not mention the roles of budgetary control in their organization.

MAN-UP MULTI-PURPOSE COOPERATIVE

In Man-up MPC their organization have allocated expenditures applied so they just need to make
sure that it aligns with the proposal. Their or also uses budgetary control and stated that “ Budget
will be the layout or the guide for the cooperative to make decisions efficiently and effectively.”
They also stated the role of budgetary control in their cooperative which is to help them achieve
their cooperative’s goals and objectives in a way that it will guide the cooperative in make the
projects go well and definitely achieve its purpose.

AKLAN PWD CONSUMERS COOPERATIVE

The president of Aklan PWD makes sure that everything in their organization is transparent,
especially when it comes to their budgets and funds. She also said that Aklan PWD cooperative
uses budgetary control “Every day we monitor our budget, we monitor and list our profit each
day if possible. Through this we can make sure that we don’t run out and loss money.” She also
then added the role of budgetary control “Budgetary control helps our organization to track our
expenses and ensure that our financial goals are met. It is important in the organization, even if
there is a loss of money.” And lastly she added that budgetary control guides their organization
in a way that it assesses their financial health and also in planning their future finances.

TAGOROROC MAINUSWAGONG PANIMALAY CONSUMERS COOPERATIVE

According to their president: “Transparency is observed. During regular meetings or assembly,

discussions regarding the project is presented to the members.” He also said that they use
budgetary control and that the budget will be the layout for their cooperative. The role of
budgetary control is to help their cooperative achieve their goals and objectives.

KALIBO SAVE THE MANGROVE ASSOCIATION, INC. (KASAMA)

The tourism manager of KASAMA said that they have their board meeting every month and in
that meeting they report their actual funds spent and how much profit they earned. They use
budget information and control bay monitoring the total income every day and they also remit
the income every day. The tourism manager also added that their receipt is from BIR because it
is the only way for them to help the government. She also added that budgetary control is
important in managing their budget and funds because KASAMA is an institution it should really
need management. The funds should be managed the tourism manager said “if there is no fund,
where should we get the salaries, the payments for our bills, We have control over everything.
Water, electricity, office supplies, and miscellaneous. However, we're saving. We merely
minimize the usage. Our income isn’t that high enough.”

We really need to minimize our expenses because we don’t earn much profit.

NON-TIMBER FOREST PRODUCTS- EXCHANGE PROGRAMME (NTFP-EP)

The area coordinator of NTFP-EP said that they track their spending: “Because we are SEC
registered, We annually report to the BIR. We have a good record in our audit, sometimes there
are feedbacks coming from the auditors but we address it.

They are also partnered with the projects of the DENR, They also have requirements.

“We then look if we need funds, and if we are in need of funds we should comply with the
requirements of the DENR. So we also comply with what they need and and the requirement. So
it depends also on who are our partners.
The area coordinator also added that budgetary controls help their organization in achieving its
goals and objectives and that they have strategic plan, On that strategic plan it includes the needs
to meet the vision for the current year. It also needs to be assessed and reviewed. And after that
to look for the things done and has not done, If it has been met and or not.

GUGMA MEDICAL FOUNDATION INC.

The chairman of GUGMA foundation states that “If you were to ask me as CPA my job is to do
the finance and records. So as a chairman and a CPA at the same time, I can see if they are
mishandling the funds and can also conclude it from the reports especially if it is only on a small
scale budget, but if it involves large amount of funds then I can say that it would be a little
difficult to find out.” About how does their non-profit organization understand the way their
funds are spent.

The chairman also said that they use budgetary control in making decisions.

He also emphasized the importance of internal control and the role of budgetary control in their
organization:

“Internal control is very important. Example for our internal control is we should not assign the
same person who handles two positions that conflicts, example same person is in the position of
cashier as well as handles the position of a bookkeeper. Custodianship and recording functions
should be different persons to avoid wastage and incurring losses for the organizations.
Therefore, if you are assigned as a treasurer then someone should be assigned to be the
bookkeeper to check the balance as an internal control.”

“The budgetary control will be seen if the internal control is working properly. So that in
situations that we discovered that there are no official receipts issued from purchases then we
cannot liquidate it properly since we check the processes and we can also know why the funds
allocated are big but the personnel only bought cheaper. Our internal control is we always check
the receipts if it reconciles from the released budget or we asked the suppliers or sellers of the
goods for further checking.

ARCHBISHOP GABRIEL M. REYES FOUNDATION, INC.

One of the officers of the board of trustees said that their organization understands the way its
funds are spent based on “the in-depth orientation on the spirit of volunteerism, the principle of
sharing treasure, time and talents without expecting something in return and helping others for
God’s glory as one of life’s purposes. “

The officer also added that they use budget information in making decisions based on project
proposals which align with its visions and mission, as well as on plans and activities which could
contribute to the attainment of its goals and objectives. He also stated the role of budgetary
control in their organization which is “budgetary control is significantly important so as to
facilitate and guarantee smooth, efficient and quality program implementation with its duration.”
And also said that budgetary control guides their organization in achieving its goals and
objectives. Lastly, the officer added “Budget control as a guide to internal control paves the way
to effective and efficient implementation of programs/projects/activities, especially in terms of
quality and timeliness.”