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C.A.'s comments on student exemplars Pathfinder's project
Starting off the whole process by asking, "what do we need, what are all the different factors that we need to consider off the top for this camping trip?" is an excellent step. It is really very important get everything you need to contemplate when you start out. Balancing between the quantitative and qualitative sides Looking at this project as a C.A., I might dig it even deeper than what they did in the first step. For example, they talk about food; what kind of food are you going to bring? what sort of supplies? Even digging deeper with the food, you can say, what's going to be easiest food to take with us? What's going to be easiest food to prepare out at the campsite. You have to weigh that factor in there as well. That is called balancing between the quantitative (cost side) and the qualitative (what sort of non-financial characteristics are there about this factor that are going to affect our decision making). Considering the different alternatives The other thing that I might have considered in the project is the different alternatives. They start to talk about them a little later on when they say, "we can all pile in to a bus, but my mom will drive me". Recognizing those up front is very important. Recognizing what you can and can't do. One of the things that might have been tried if this budgeting exercise was taken a little bit further would be to look at the different kinds of costs that are involved. And by different kinds of costs, what I'm referring to is you can group them into two types. There's a series of costs that you are going to have to pay no matter what. It doesn't matter how many people are coming, or how far you're going. You're going to have to pay for basics. Those are the fixed costs. For example, if you decided that you are going to rent a van to go on this camping trip, it doesn't matter if you put 2 people or 10 people in this van, you still have to pay the $1000 or whatever it is to rent that van for the trip. Then there is a series of costs that are going to vary depending on how many people are coming with you, and what sort of things you want to do. Those are the variable costs. Stating the references for the estimates Reading the estimates they give in the second step, it is hard to know the basis of the estimates. There is need to be more specific about where these estimates are got from. It might be helpful in a budgeting exercise to go out and figure out these estimates, and even to state the references for the estimates in your presentation.
Considering costs as a range and including the emergency fund Furthermore, it may be more helpful to consider the estimates as a range of costs or even to just include a general contigency/ emergency fund. For example, what if you say you are going to spend $10 on food, and let's say that half the food spoils on the trip; what sort of contigencies are given in your budget for emergency and other non planned occurences some of which occurences may be positive. The step of checking whether the costs are reasonable is good, however they never talk about going back to revisit the budget. Being able to go back and revisit your budget is important not only to allow you to change your options or your alternatives, but also in the case where all of sudden you have this new cost--this honorarium that will have to be shared around with the people who are traveling with you. So having this awareness that you can go back to revisit your budget is required. Budgets generally don't stay solid forever and certainly in this era of the new economy we are seeing that. Considering the funds available On considering the source of funding, I don't think that they ever really considered at all any funds available with the camper project; which is fine within the context, it wasn't something that was required. They were looking at: where do we want to go? how much we are going to spend? and how can we minimize that? That was the key for the project. It's an interesting task in that sense that however much money they need they really have access to the money through parents. This is just about, "how much do we need", we have a source of money, But in business, this isn't the case. In business you have to considers the source of funding. With comparing the tent teams preliminary budgets to their actual expenses; I do that personally with my own finances and also professionally. In an audit context, I do look at what the company was expecting to spend; Why did it happen, why didn't it happen. Why did they spend too much? Looking at how the whole analysis was set up in the project, there was that budget form that each of the campers filled out--what each expected. I'm not sure that I ever saw that comparison of the budgeted to the actual expenses, and the teacher raised the question that, "what was the actual cost per camper for the group? Was the budget running on a deficit or a surplus?" This is important to consider in the grand scheme of things. They could have set up the comparison between the planned and the actual with a spreadsheet.
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