What are the best practices for creating a program budget that is easy to communicate to stakeholders?

2 Use a standard format

Creating a program budget that is easy to communicate requires using a standard format that is consistent and familiar to your stakeholders. This can help avoid confusion and errors, as well as make it simpler to compare and track your budget over time. You can choose to use a simple spreadsheet or a software tool that allows you to build and manage your budget online. The standard format should include a summary page with the total income and expenses of your program, as well as the surplus or deficit. Additionally, there should be a detailed breakdown of income sources, such as grants, donations, fees, or in-kind contributions, and expenses, such as salaries, supplies, travel, or overhead. Furthermore, a narrative explanation describing the assumptions, calculations, and justifications behind your budget figures should be included. Lastly, you should have a contingency plan outlining how you will handle any unexpected changes or risks in your budget.

3 Align your budget with your program objectives

The third step in creating a program budget that is easy to communicate is to align your budget with your program objectives. Your program objectives are the specific and measurable results that you want to achieve with your program, such as increasing awareness, improving skills, or changing behaviors. Your budget should reflect how you allocate your resources to support your program objectives and activities. You can use a logic model or a theory of change to show the logical connection between your inputs, outputs, outcomes, and impact. You can also use indicators and targets to measure and report on your progress and achievements.

4 Be realistic and flexible

The fourth step in creating a program budget that is easy to communicate is to be realistic and flexible. A realistic budget is based on accurate and reliable data, such as historical records, market research, or expert opinions. It also considers the external factors that may affect your income and expenses, such as inflation, exchange rates, or political changes. A flexible budget is able to adapt to changing circumstances and opportunities, such as new funding sources, unexpected costs, or emerging needs. You can use scenario planning or sensitivity analysis to explore different possibilities and prepare for different situations.

5 Review and revise your budget regularly

The fifth step in creating a program budget that is easy to communicate is to review and revise your budget regularly. A budget is not a static document, but a dynamic tool that guides your decision making and actions. You should monitor your budget performance and compare it with your actual income and expenses on a monthly, quarterly, or annual basis. You should also update your budget whenever there are significant changes in your program or environment. By reviewing and revising your budget regularly, you can identify and address any gaps, errors, or deviations, and ensure that your budget remains relevant and realistic.

6 Communicate your budget effectively

The final step in creating a program budget that is easy to communicate is to communicate your budget effectively. Communication is not only about sharing your budget numbers, but also about telling your budget story. Your budget story is the narrative that explains how your budget supports your program vision and mission, and how it demonstrates your value and impact. You can use various methods and channels to communicate your budget effectively, such as reports, presentations, dashboards, or infographics. You should also use clear and simple language, avoid jargon and acronyms, and use visuals and examples to illustrate your points. Most importantly, you should engage your stakeholders in a dialogue, solicit their feedback, and address their questions and concerns.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?