Chapter 21, Problem 21.3TIF

Communication

The city of .Milton has an annual budget cycle that begins on July 1 and ends on June 30. At the beginning of each budget year, an annual budget is established for each derailment. The annual budget is divided equally among the 12 months to provide a constant monthly italic budget. On June 30, all unspent budgeted monies for the budget year from the various city departments must be "returned" to the General Fund. Thus, if department heads tail to use the It budget by year-end, they will lose it. A budget analyst prepared a chart of the difference between the monthly actual and budgeted amounts for all departments in a recent fiscal year. The chart wav as follows:

Write a memo to Stacy Poindexter, the city manager, interpreting the chart and suggesting improvements to the budgeting system.