Financial Management for Libraries

Description

Presenting financial management principles and best practices applicable to both public and academic libraries, this comprehensive text elucidates a broad array of issues crucial for those entering a managerial position. Both thorough and straightforward, Sannwald's treatment

gives readers a solid grounding in the basics of accounting and finance, with an emphasis on applicability to library management and operations;

ties budgets and strategic planning to library vision, mission, goals, and objectives;

discusses the roles of stakeholders such as boards, governmental/municipal bodies, the university, and the community;

looks at a variety of funding sources, from tax revenue to gifts and donations, and presents sound strategies for including them when projecting income and expenses;

articulates and discusses the pros and cons of various budget strategies;

includes sample budgets and forms that can be customized as needed;

offers expert guidance on modifying budgets for windfalls and shortfalls;

explains operating ratios, fiscal benchmarking, and metrics, demonstrating how to use these to effectively create and manage a budget and assess the fiscal health of the library; and

advises on how to effectively prepare and present a budget and annual financial statements to a library's governing agency.

Ideal for course use, this book will also serve as a ready reference for practitioners. "This book excels in featuring a large amount of information about library budgets with real-world examples and a layout that is easy to follow.”
— Library Quarterly "Recommended as an introduction to financial management for established library professionals and students. Librarians that do not directly handle budgets benefit from understanding the complexity of the process for a greater appreciation of budgetary decisions.”
— ARBA "This is an excellent book for those new to putting these principles into action, those who wish a good overview on financial management or those who want practical and useful examples to deal with their own needs.”
— Journal of Hospital Librarianship William W. Sannwald was assistant to the city manager and manager of library design and development from 1997 to 2004, and was city librarian of the San Diego Public Library from 1979 to 1997. He is now a full-time faculty member in the business school at San Diego State University, where he teaches senior and MBA classes in management. He also works as a library building and administrative consultant. He is the author of numerous books and articles on library architecture and management, including Checklist of Library Building Design Considerations, and has presented papers at national and international conferences. Past president of the Library Leadership & Management Association (LLAMA), Sannwald was twice a jury member of the joint American Library Association/American Institute of Architects awards. He is the recipient of the San Diego American Institute of Architects chapter’s highest honor, the Irving Gill Award, for his contributions to library architecture.

List of Illustrations
Preface1    Introduction to Budgeting and Strategic Planning Learning Objectives
What Is a Budget?
Budgeting and the Library’s Strategic Planning Process
Types of Budgets That May Be Used in Libraries
Budgetary Approaches
Budgetary Tools
Financing Libraries
Budgetary Controls
Cash Flow, Forecasting, and Tools for Determining the Size of the Budget
Forecasting
Budget Planning Team and Budget Preparation Process
Budget Presentation
Exercises
References
2    Accounting Concepts Learning Objectives
Accounting History
Financial and Managerial Accounting
Basic Accounting Equation
Generally Accepted Accounting Principles (GAAP) and the Governmental Accounting Standards Board (GASB)
The Auditing Process
Cash-Basis and Accrual-Basis Accounting
The Balance Sheet
The Income Statement
The Statement of Cash Flows
Chart of Accounts
Accounting Cycle
Summary
Exercises
References
3    Library Budget Development Process and Participants Learning Objectives
Budget Calendar
Budget Process Questions
Budgetary Checklist
How Is the Dollar Amount of the Library’s Budget Determined?

San Diego State University

Chula Vista Public Library

Schaumburg Township District Library

Budget Development Team Participants

San Diego State University

Chula Vista Public Library

Schaumburg Township District Library

Summary
Exercises
References
4    Library Performance Measures and Operating Ratios Learning Objectives
Introduction
Standards, Inputs, Outputs, Processes, Satisfaction, and Outcomes

Standards

Inputs and Outputs

Processes and Satisfaction

Outcomes

Benchmarking

Steps in the Benchmarking Process

Criteria for Selecting a Benchmarking Set

Data Sources

ACRLMetrics

Public Library Data Services

Edge

State and Local Resources

Operating and Financial Ratios

Programmatic Needs
What Can We Afford?
Exercises
References
5    Budgeting and Forecasting Learning Objectives
Budgeting
Types of Budgets

Master Budget

Operating Budget

Financial Budgets

Capital Budgets

Other Budgets

Budget Build Up

Budgeting Techniques or Formats

Line-Item Budgets

Program Budgets

Performance Budgets

Zero-Based Budgets

Forecasting
Summary
Exercises
References
6    Revenue Sources Learning Objectives
Tax-Supported Academic Libraries
Privately-Supported Academic Libraries
Tax-Supported Public Libraries

District Libraries

Fines and Fees
Philanthropy

Ongoing Support

Capital Campaigns

College and Research Library Philanthropy

Public Library Philanthropy

Local Public Library Philanthropy

Foundations and Grants
Other Revenue Opportunities
Summary
Exercises
References
7    Capital Budgets Learning Objectives
Capital Budgeting
Capital Budgeting Decisions
Capital Budgeting in the Profit and Nonprofit Sectors

Net Present Value

Internal Rate of Return

Net Present Cost

Annualized Cost

Estimating Capital Needs
Financing Capital Projects

Bond Issues

Funding from the Parent Institution    

Foundation Grants

Developer Fees

Estimating Capital Budgets for Library Buildings
Case Study—New Library Branch for San Diego State University

What Factors Drive the Need for a New Library Building?

Who Will Be Served?

Summary
Exercises
References
8    Approval and Control Learning Objectives
Budget Submittal, Approval, and Communication

Budget Submittal

Budget Communication

Budget Approval

Control

Financial Control Process

Financial Dashboards

Modifying Budgets

Financial Condition Analysis

Financial Audits

Deviant Financial Behavior and Fraud

Inappropriate Absenteeism or Tardiness

Theft of Organizational Assets or Property

Destruction of Organization Assets or Property

Summary
Exercises
References
9    Budgetary Categories, Comparisons, Forms, and the Balanced Scorecard Learning Objectives
Budgetary Categories
Budget Comparisons

Historical Comparisons

Future Estimates

Forecasting

Scenario Analysis

Budgetary Systems

Payroll System

Purchasing System

Balanced Scorecard

Financial and Budgetary Forms

Uniform Chart of Accounts

Balance Sheet

Income Statement

Statement of Cash Flows:

Annual Operating Budget

Department Build-up Budget

Program Budget

Capital Budget

Modifying Budgets for Windfalls and Downturns

Summary
Exercises
References
Exhibits
Index