10 Νοε 2013 (πριν από 4 χρόνια και 8 μήνες)

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Usually refers to major durable items, such as
buildings, land, large items of equipment, and
often including major renovative or
enhancement programs

They are normally excluded from the annual


It is the authorization to switch expenditure
from one budget heading to another.

Cost centers

The characteristics of a cost center are that it is
responsible for its own budget and that all expenditures
incurred by it are debited to it


It is the art of measuring the consumption of resources
in financial terms.

Opportunity costs

Every expenditure and transfer of resources has its
opportunity cost

the next
best alternative use for these

Direct and indirect cost

Direct costs are costs that can be easily
identified with a cost center

Indirect costs are costs that cannot be identified
and have to be apportioned (sometimes called

The Three Es of

Financial Management


It can be defined as careful use of resources, frugality,
and good housekeeping

Examples: Repair of equipment rather than a new
purchase, effective arrangements for stock
taking and


It is the fullest possible attainment of specific objectives
or standards

Examples: An air
conditioning system brings all rooms to
the desired temperature, a timetable which deploys staff
fully, and etc


It relates efficiency to its cost. X is more cost
efficient than Y because it achieves greater
efficiency at the same cost or same efficiency at
lower cost

Examples: A new air
conditioner which provides
the same cooling system more economically,
preventive maintenance of buildings which
avoids long
term maintenance costs, and
purchase of slightly more expensive equipment
which stands up better to wear, and etc.


It is the fullest possible attainment of the goals and
objectives of the school

Examples: Improved performance, improved student
attitudes and behavior, better parent and community
relations and etc

Cost effectiveness

It relates effectives to the cost incurred

Examples: Expenditure on the promotion of schools
brings increased enrolment, peer tutoring improves
student performance with little extra cost, and etc

The three Es can be in conflict, but how?

Cost Characteristics of


Most schools are non
profit organizations.

There is no single objective criterion to use in
measuring performance

There is no way to estimate the relationship
between inputs and outputs

Schools are service organizations and perform a
social as well as an economic function.

This makes measurement and costing of their
output difficult

School cost structures are very stable (Schools
are conservative institutions).

School unit costs tend to rise when education
becomes more technical and science
when it deals with older students, and when
there is greater concern for quality

Schools are very labor

School calendars cause high costs

School Financial Management Model


Features of the model

Finance triggers and controls the system

An individual component, be it financial resources or human or
physical resources, are only part of the system.

The further away from the initial financial input, the more its direct
impact is reduced

The whole system is susceptible to good management

Financial management has two faces: money management and cost

Cost management not only dealing with identifying costs and
reducing them, but also covers time utilization, the educational
process and its outputs, and alternative educational strategies, and