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Paper PFM 13

Budgeting, Revenue and Cash Management

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The aim of this subject is to provide the learner with the knowledge and skills required to undertake the budget process in the public sector according to the legal and institutional framework laid down. In addition, the learner will be equipped with skills to enable him/ her to manage revenue, forecast cash requirements and account for cash imprests and advances.

On completion, a candidate should be able to

  • Explain the principles of a sound budget, the types of budgets and the public sector budget cycle.
  • Discuss the legal and institutional framework for budget management.
  • Explain the various stages of the public budget making process.
  • Discuss the process of budget making in the county governments.
  • Explain the process of management of revenue and the role of accounting officers.
  • Explain the process of revenue management in county governments and the roles of various organs and institutions.
  • Discuss the process of cash management in the public sector.
  • Explain the various facets of cash forecasting and how imprest and cash advances are accounted for.
  • Discuss the management of consolidated fund services and Exchequer accounts.

Content

  1. 1

    Introduction to public sector Budgeting

    Explain the principles of a sound budget, the types of budgets and the public sector budget cycle.

    1. 1.1

      Provisions of the National Budget in line with PFM Act 2012

    2. 1.2

      Principles of a Soundness of the Budget

    3. 1.3

      Types of Budgets and rational for their application

    4. 1.4

      The Public sector Budget cycle and Stages

  2. 2

    Legal and institutional framework in budget management

    Discuss the legal and institutional framework for budget management.

    1. 2.1

      The Constitution

      1. f Kenya, 2010

    2. 2.2

      Public Finance Act 2012 and Regulations

    3. 2.3

      Public Procurement and Disposal Act 2015

    4. 2.4

      Budget circulars and guidelines

    5. 2.5

      County Government Act 2012

    6. 2.6

      County Assembly standing orders

    7. 2.7

      The role of National Treasury in preparation of the national budget

    8. 2.8

      The of the Controller of Budget in budget preparation

  3. 3

    The Public budget process

    Explain the various stages of the public budget making process.

    1. 3.1

      Budget policy Statement

    2. 3.2

      Budget review

      1. utlook paper

    3. 3.3

      Medium term expenditure framework (MTEF)

    4. 3.4

      Budget framework and its components

    5. 3.5

      The role of sector working groups

    6. 3.6

      Procedure of invoking Article 223 of Constitution of Kenya and Vote on Account

    7. 3.7

      The process

      1. f approving Appropriation Act

    8. 3.8

      Submission of budget estimates and related documents for approval

    9. 3.9

      Procedure for Consolidation of budget estimates by the National Treasury

    10. 3.10

      Submission of budget estimates for discussions and consideration by National assembly budget committee

    11. 3.11

      Approval of the Finance Bill by the National Assembly

    12. 3.12

      Procedure

      1. f preparation of Supplementary Budget for the National Government

  4. 4

    County Government Budget Process

    Discuss the process of budget making in the county governments.

    1. 4.1

      Stages of county Government budgets

    2. 4.2

      The appointment and role of County Budget and Economic Forum (CBEF)

    3. 4.3

      Preparation

      1. f Development plans and cash flow projections

    4. 4.4

      Responsibilities

      1. f County Executive Committee Member of Finance in the Budget process

    5. 4.5

      Submission and approval of budget estimates as finance bill by County Assembly

    6. 4.6

      Remedies for the delay in enacting County Appropriation Bill

    7. 4.7

      Procedure for appropriating money unspent by the County Governments

  5. 5

    Management of Revenue

    Explain the process of management of revenue and the role of accounting officers.

    1. 5.1

      Procedure for Revenue classification

    2. 5.2

      Procedure for estimating revenues

    3. 5.3

      Definition for Receivers of Revenue

    4. 5.4

      Appointment of Receivers of Revenue

    5. 5.5

      Accounting procedure for the Receivers of Revenue

    6. 5.6

      Reporting mechanisms for Receivers of Revenue

    7. 5.7

      The Role of Accounting officers in management

      1. f Receivers of Revenues

  6. 6

    Management of Revenues in County Governments

    Explain the process of revenue management in county governments and the roles of various organs and institutions.

    1. 6.1

      Classification

      1. f revenues in the County Governments

    2. 6.2

      Management of revenue in the County Governments

    3. 6.3

      The role of Committee Executive Member in revenue management

    4. 6.4

      The Role of the Commission on revenue Allocation (CRA) and Office

      1. f Controller of Budget (OCOB) in management of County government revenues and funds.

  7. 7

    Overview of cash management in public sector

    Discuss the process of cash management in the public sector.

    1. 7.1

      Components

      1. f cash and cash equivalent

    2. 7.2

      Maintenance of Cashbooks and cash analysis book

    3. 7.3

      The Board of Survey

    4. 7.4

      The role of the National Treasury in management of Cash

    5. 7.5

      Overview on

      1. peration of Treasury Single account

    6. 7.6

      Banking, Banking arrangement and Operations of Exchequer

    7. 7.7

      The role of National Treasury in management Bank Accounts

    8. 7.8

      Procedure of

      1. pening and closing bank Accounts

    9. 7.9

      Preparation and submission of Bank account register

  8. 8

    Forecasting cash, cash advances and imprest

    Explain the various facets of cash forecasting and how imprest and cash advances are accounted for.

    1. 8.1

      Preparation of annual Cash planning and submission to the National Treasury

    2. 8.2

      Procedure for aligning cash plans with the budget

    3. 8.3

      The role of head

      1. f accounting unit and finance officer in preparation of cash plans

    4. 8.4

      Challenges faced when preparing cash plans

    5. 8.5

      Components of cash advances

    6. 8.6

      Procedure for issuing cash advances

    7. 8.7

      Types of imprest and their characteristics

    8. 8.8

      Procedure for Accounting and recording of imprests

    9. 8.9

      Procedure for surrendering and recovering of

      1. utstanding imprests

    10. 8.10

      The role of accounting officer in management of cash advances and imprests

    11. 8.11

      Sanctions and consequences for failing to comply with the PFM Act 2012

      1. n matters of cash advances.

  9. 9

    Management of Consolidated Fund Services and Exchequer Accounts

    Discuss the management of consolidated fund services and Exchequer accounts.

    1. 9.1

      Scope and

      1. bjectives of Consolidated Fund Services

    2. 9.2

      Expenditures covered by the Consolidated Fund Services

    3. 9.3

      The Exchequer Account

    4. 9.4

      Procedure for exchequer requisitioning

    5. 9.5

      The role of Accounting officers in exchequer requisition.

    6. 9.6

      Operation of the County Revenue Fund and

    7. 9.7

      Accountable documents in management of cash and Revenue

    8. 9.8

      Overview

      1. f accountable documents in management of revenue

    9. 9.9

      Procedure for recording cash and revenues

    10. 9.10

      Accountable documents used in collection and surrendering of revenues