Planning, Budgeting and Forecasting

Overview

Yale utilizes an “all funds, full cost” approach to budgeting in order to ensure excellent stewardship of Yale’s mission and resources. This means that the anticipated cost of every program, department, and activity has a source of funding (general appropriations, gifts, grant, etc.) identified during the planning process, and that every fund is included in the planning process. The University’s annual planning and budgeting process is led by the Financial Planning & Analysis group within the Division of Finance. The Provost, as chief budgetary officer for the University, has the institutional responsibility for the allocation of resources.

Schools and units submit their budget proposals for consideration by the Provost and the Budget Advisory Committee in the spring. The Budget Advisory Committee includes twelve faculty members in addition to the Provost, Senior Vice President for Operations (SVP/COO), Vice President for Finance (VP/CFO), and other senior administrators. The group meets with the units to understand the budget proposals and then make recommendations to the Provost regarding funding the budget requests. The Provost, SVP/COO, and VP/CFO then recommend the budget to the President who requests approval from the board of trustees. The board of trustees, formally known as the Yale Corporation, provides approval in June. Deans, Directors, Chairs and Lead Administrators have responsibility for ensuring that funds are expended in a manner consistent with the annual budget as approved by the Corporation.

The University uses the Yale Budget Tool (YBT) to build and monitor budgets. Units create “labor plans”, “grant plans” and “financial plans” to capture all planned activity. Once budget workbooks are populated at the department and program level, YBT enables managers to have various views of both detailed and aggregate budgets to assist with the planning process and monitoring process. YBT rolls-up all of the budget workbooks into one of the 50 planning units, which in turn are aggregated into a single University budget. Using YBT, each of the planning units are also required to submit a second quarter forecast and a year-end actual to budget variance analysis in order to properly monitor Yale’s financial resources and plans.