Budget Implementation and Control
1. Execution and Control of the agency budget
The distribution of budget shall be carried out in accordance with the executive progress of programs. Based on accurate planning and control, it can achieve a perfect financial arrangement. Before the budget is implemented, each agency shall prepare distribution budget and submit it to the Department of Budget, Accounting and Statistics (DBAS) for approval. During a fiscal year, if any agency needs to change the original execution program or adjust executive progress other than those distribution budgets whose execution periods expired, it should apply to modify the distribution budget for collection or expenditure in advance.
Shifting funds from one finance activity to another activity is an important measure allowing flexibility in the execution of budget. Attaining the goals set for administrative programs depend on the flexible execution of budget to attain. In order to meet the actual demand of each agency, the Budget Act restricts such shifting to a limited number of accounts. In addition, in order to permit flexibility in the execution of budget and, at the same time, control of such execution, the DBAS shall set a limit on the ratio of the fund that could be shifted in or out of an account for sub-programs.
During the period from the beginning of the budget preparation to the time of execution, some unanticipated causes or socioeconomic changes may make the budget insufficient or unable to meet the requirements. To allow flexibility and attain the goals set for administrative programs, the Budget Act authorizes the setting of the reserve fund. The first reserve fund is set in the budget of competent agencies and the secondary reserve fund is set in the general budget for Taipei Municipal Government. Additionally, some overall arranging accounts are set in the general budget, including National Compensation Foundation, Reserve Foundation for Disaster, and Retirement & Consolation Pay for Government Employees.
2. Execution and Control of the Subordinate agency budget
- (1)Stage-by-stage Execution Plan and Receipt/Payment Estimate Table for Reference
Based on actual operation situations, each business (affairs) agency (institute) should estimate all possible changes and divide one year into two terms, then verify and prepare the stage-by-stage execution plan and receipt/payment estimate table with restriction. After that, the agency submits its associated plan and table to competent agency as a reference of evaluation. - (2)Approval for Financial Statement Proposal with Receipt/Payment Adjustment
According to Article 87 of the Budget Act, the receipt/payment adjustment for operation requirement should be submitted to the agency's chief for approval with the subordinate agency budget, then it can be incorporated into the financial statement. Special items such as budget for new employees should be submitted to TCG for approval. It is after the above procedures that the subordinate agency budget may be incorporated into the financial statement. - (3)Approval for Supplementary Budget Proposal
According to Article 88 of the Budget Act, Implementation of the subordinate agency budget, if there are major changes in the management environment or for normal operation needs, these changes must be done with approval by the TCG, However, when it involves construction, improvement, expansion of fixed assets, capital reinvestment, sale of assets, raising of long-term debt and debt repayment, supplementary budget procedure shall be required. If the amount is over NT$ 50 million per item, it should be submitted to Taipei City Council for reference. - (4)Evaluation of Budget Execution Performance
- a.The budget execution performance of subordinate government agencies will be reported in Taipei City Executive Meeting periodically. Those agencies whose execution is behind over 20% will be urged to improve the situation.
- b.Establish the "Awards and Penalties Directions for Evaluation of Budget Execution Performance of Agencies of Taipei City Government". According to this direction, if the actual execution ratio of any agency which is related to the construction, improvement and expansion plan of fixed assets, increasing the long-term investment of funds, receivables plan with ongoing constructions and profit/loss or surplus/deficiency falls behind over 20% without any uncontrollable reasons, persons in charge of the agency will be punished. On the other hand, persons in charge of the agency with excellent budget execution performance will be rewarded.
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