Each year, local governments produce a budget document outlining the various initiatives undertaken for their constituency and its associated financial implications. This document identifies the services to be provided and contains the rationale behind such decisions along with the financial summary.
Traditionally, this budget document has been shared in the form of a physical book containing all the relevant information about the various initiatives undertaken by the local government and associated spreadsheets and ledgers. While this format is used extensively, reviewing this document can be a painstaking process.
With the introduction of new tools and technology, there has been a shift towards modernizing the budgeting process within public sector organizations. This includes shifting from manual spreadsheets to specialized budgeting software, as well as the implementation of a digital budget book for reporting purposes.
What is a digital budget book?
When thinking of a “digital budget book,” most people picture a “digitized version of a budget document.” However, depending on the vendor you’re working with, a digital budget book can mean many different things.
For example, most digital budget books currently available encompass a data visualization tool. There are several benefits associated with using data visualization tools while presenting your budget. However, it is good to be aware of the differences between a comprehensive digital budget book and a quick-fix data visualization tool used to present the budget.
If your organization is looking to go digital with your budget book, it’s important to know that not all the products offered in the market are the same. Whereas some vendors promise completely digital budget books at a low cost with limited capabilities, others may offer a hybrid tool that gives you the option to present a digital budget book or printed book. However, like a spork, certain hybrid solutions may seem to offer “the best of both worlds” while providing limited functionality to accomplish either objective.
As you consider moving to a digital budget book, here are a few things to keep in mind:
Have you digitized your budgeting process itself?
To accomplish the objective of streamlining processes and saving time, the data visualization tool that generates a digital budget book will also require an integration into a budget management system from which it can pull data to make graphs and charts. Think about the difference in workflow: when you need to correct some text or change some numbers, can you update your budget book with the push of a button, or does this mean you’ll have to embark on a time-consuming manual process?
For example, if you alter a number, an integrated process can ensure that your change is correctly reflected across the document – in every table, chart, and even text that mentions numbers in the middle of a paragraph. If you need to carry out this kind of fine-grained review and update for every change, you’re missing out on a major benefit of an integrated process. Otherwise, the task of producing a digital budget book may be more complex and labor intensive.
What makes the format “engaging” and “interactive?”
Data visualization tools are marketed by mentioning how engaging and interactive they are. However, in the context of public sector budgeting, it is merely an interactive format to view budget data and doesn’t account for details relating to the actual decision behind budget allocations. Depending on your needs and requirements, it’s important to research the many features and benefits offered to ensure your solution can track constituency choice and needs.
Does it do the job at hand?
For governments, to maintain transparency with surrounding communities, most aim to release a comprehensive document that allows its readers to view the data, understand the rationale for budget allocations, and note the decision-makers behind it. Doing so also helps ensure public sector organizations are adhering to laws and regulations while providing a clear audit trail. Some digital budget book providers promise the ability to do it all online, but not all of them can promise full compliance with state or federal regulations, including accessibility requirements and American Disability Act (ADA) compliance.
Is a digital budget book indeed cost-effective?
The upfront argument would be that a data visualization tool is a one-time expense and saves you the trouble of printing out a physical document. While this may produce short-term time savings and potential cost efficiencies, limited functionality means it may not be able to do everything you want. Some solutions may require more upfront time and investment but, in the end, can help you keep tabs of a budget book electronically while giving you the ability to print a physical budget book for legislative entities that still require hard copies.
A “digital budget book” is more than simply visualizing the data at hand but an all-encompassing document that will allow a constituent to better understand where their taxpayer dollars are going. So, the real question for public sector organizations should be – “What combination of tools and software will help me provide my constituency with the most compliant, transparent, and easy-to-navigate budget document?”
Budget documents are crucial for governments as they highlight how they have used public funds towards the development of their constituency, enabling them to gain voter confidence and trust. Not only does this book have to adhere to the criteria set by the higher authorities during their review, but it also must be an all-encompassing document that is digestible for higher authorities as well as the general public. This puts a greater emphasis on the format used to display all budget planning-related information.
It is advisable that public sector organizations weigh all their options when it comes to the digital budget book. Not every solution can live up to the hype. Ultimately, the end goal should be to create a comprehensive document with all the necessary information about the funding received, its allocation, overall expenditures, and revenue earned for the fiscal year in question.
Want to learn more about how Questica can help you create the most comprehensive budget book? Schedule a demo today to see our software in action!