Budget requests are normally reviewed and analyzed each time they are consolidated for presentation to a higher level of the process, until an institutional budget is ultimately presented to the governing board for consideration. Revenue estimation and activity analyses by administrators greatly impact the negotiations between the decision-makers in control and balancing the expenses with revenue. The boards of trustees act on the general outline of the proposed budget and on specific recommendations for tuition and fees, room and board increases, salary increases, and proportion of endowment income to be applied to the operating budget and student aid. Closing out the fiscal year- external auditors are usually private accounting firms who test and evaluate the institution s internal financial controls and its compliance with financial policies. Normally included in their reports is a management letter stating that the financial data are accurate and that the accounting systems are trustworthy.
Most states employ a preliminary asking budget cycle.
Based on this preliminary budget, a budget ceiling is set by the governor s budget and becomes the framework within which the institutions prepare their detailed asking budget. Different than independent institutions, public institution budget requests go to the regents who package all of the institution's requests in a regents request. The authors note a trend in that legislative fiscal staffs, and some governor s budget staffs, have grown rapidly in size and sophistication over the past two decades which has resulted in diminishing the influence of the regents on the budget packaging. In some states there is considerable informal lobbying between individual institutions, system officials, and trustees on one hand and legislators on the other. Higher education is often the last appropriation because of its discrete nature.