The importance of budgeting and managing finances in youth-sports programs
All league administrators should have a budget in place before taking a single registration. The budget should estimate revenue and expenses and separate them as individual line items. Estimate revenue low and expenses high in order to provide for some margin of error. Once the budget is set, keep the spending within the budget unless there is additional revenue that might justify additional spending.
A budget serves as all of the following:
· Operations guide: A budget will dictate how to operate a league based on anticipated revenue and expenses. It will explain how the organization is divided by roles and how they operate.
· Financial plan: Sound budgeting will keep finances in order and identify any areas where you can fine-tune spending or save money. It should show sources of revenue and allocated expenses.
· Communications device: A budget provides an understanding for others in a league or the overall organization as to the forecasted revenue and the plan to allocate funds for expenses. It helps stakeholders understand why only certain funds are used for certain expenses.