Ward Budgets - What if not balanced?

In the last couple of years our ward has been +/- 5% of our allotted budget.
Just curious who makes up the shortfall or what happens to the surplus?
Is it balanced within the stake so as long as the stake balances it is okay?
Are there any incentives (rewards) for being well under budget or punishments for going grossly over?
We are very careful with our monies and watch carefully our quarterly allotments as they can change throughout the year but what happens to wards who are way off (esp. overspent)?

punman wrote:In the last couple of years our ward has been +/- 5% of our allotted budget.
Just curious who makes up the shortfall or what happens to the surplus?
Is it balanced within the stake so as long as the stake balances it is okay?

The answers to these questions can be found at the Wiki article Budget allowance.

punman wrote:Are there any incentives (rewards) for being well under budget or punishments for going grossly over?

I would not say there are any incentives or punishment for being either under or over. The stake president should be paying close attention to the monthly stake financial summary to detect any trends in either direction. The stake president will counsel with a bishop if he thinks a unit's program is not within the budget allocation at any point. I have witnessed instructions from the stake to wards/branches when indicators where such that expenditures were not proportionate for the time of year.

punman wrote:We are very careful with our monies and watch carefully our quarterly allotments as they can change throughout the year but what happens to wards who are way off (esp. overspent)?

As I have already mentioned the stake president will in most cases catch a trend toward overspending. Most stakes take great care to watch the last two or three months' expeditures in an attempt to stay as close as possible to budget allocations. Some units may overspend and some may be under budget. Since stakes carry forward the year-end budget allocation balance they may adjust ward/branch follow-on year allocations based on the surplus or deficit. It is their choice. Our stake identifies a percentage of the annual budget for possible unit overspending or unforseen expenses.

punman wrote:Are there any incentives (rewards) for being well under budget or punishments for going grossly over?

As has been mentioned, this is largely up to your Stake President, but let me offer a couple examples.

If your stake lets the wards keep any carryover from year to year, that's your reward for coming in under budget. If your stake operates with a "use it or lose it" budget, then there is no reward, so you might as well really enjoy your holiday dinner, or make sure you buy any supplies you need before year end.

As for punishments, I'm not sure if they still do it since we've been under budget for several years now, but our stake use to deduct the amount you went over budget from your next years allocation. So, there you go.

PNMarkW2 wrote:If your stake operates with a "use it or lose it" budget, then there is no reward, so you might as well really enjoy your holiday dinner, or make sure you buy any supplies you need before year end.

Though I realize that this is a technical forum, you've touched on one of my pet peeves in my time as a financial clerk. If there is any money "left" at the end of a year and the stake chooses not to carry it over, it does not simply disappear. The money remains for the church (as a whole, in some capacity or another) to use on some other purpose. So if you truly need those supplies or need the money to fulfill a priesthood purpose, go right ahead. However, if you're planning an "extra-fancy" Christmas dinner for the ward just because you have the money in your budget, you may want to re-evaluate your plans.

Bishop Burton's BYU devotional speech from last week may give you some insight as to the workings of the Council on the Disposition of the Tithe in this regard.

Thanks for all of the helpful insights.

punman wrote:In the last couple of years our ward has been +/- 5% of our allotted budget. Just curious who makes up the shortfall or what happens to the surplus? Is it balanced within the stake so as long as the stake balances it is okay?
Are there any incentives (rewards) for being well under budget or punishments for going grossly over?
We are very careful with our monies and watch carefully our quarterly allotments as they can change throughout the year but what happens to wards who are way off (esp. overspent)?

As mentioned, it's up to your stake. They have free reign. Working on the budget right now though, so here are some thoughts. A shortfall is made up by the other wards in your stake. If you go over, the money has to come from somewhere, so it comes from their remaining budget. If as a stake you all go over, then the difference is pulled from next year's budget by CHQ. Be courteous - stay within your budget.

As far as CHQ is concerned, all's good if the stake stays below their budget. However, last year I had to reduce all ward's budgets to make sure we didn't go over. Trust me - no one was happy.

Incentives are up to your stake, as are punishments. Again, CHQ, however, will reduce next year's budget allocation if the stake as a whole goes over, which then reduces the amount of money you get. If I were in that stake, I'd make the wards that went over cover the loss and reward the wards that stayed within their budget.