Bdd Financial Training For Sr Mgt Team Bdd Partners And Business Model

Preliminary Procedure

Wednesday, April 12, 2023 Buckman Direct Diversion 1

Training Agenda9:00-9:50 am BDD Business ModelBreak 9:50-10:00 am10:00-11am BUDGET WORKSHOP: Draft

a program purpose statement and a job cost program budget.


ObjectivesDescribe the purpose and function of governing documents for BDDDifferentiate the scope and function of finance at BDD vs. City of Santa Fe as fiscal agent.Understand, in general terms, the BDD business modelKnow how to read the BDD budget and locate information in it.Identify your FY2012 activities, services, and projects as a comprehensive programDevelop a job cost budget to implement your program.


Describe the purpose and function of governing documents for BDD – 3 years


Describe the purpose and function of governing documents for BDD


Cost Sharing Matrix


Differentiate the scope and function of finance at BDD vs. City of Santa Fe as fiscal agent.

City of Santa Fe BDD Article 6 of PMFSA - Invoicing Article 7 of PMFSA – Fiscal Agent

Uniform books and accounts and segregated books and records for separate funding sources

Procure, contract and pay for an independent audit and within 90 days of fiscal year end provide copies of financials to partners.

Receive and record deposits Make approved disbursements Invest excess funds Carryover unencumbered monies Obtain approvals for expenditure

funds by BDD Board and NM DFA

Determine and record capital assets inventory, run depreciation, submit capital asset year end inventory

Prepare reports to agencies

Gather and monitor time sheets – Job cost coding

Request purchases– Job cost coding

Approve disbursements/expenses – Job cost coding.

Account for inventory - chemicals

Invoice partners Pre-bills Actuals

Compliance reporting Report to management – job cost

and financial statements Report financial condition and

position– line/fund Develop budget – line/job Process daily accounting

transactions– job cost coding. Respond to auditors inquiries.Wednesday, April 12, 2023 Buckman Direct Diversion 7

BDD Business Model – Working Capital Policy


Census 2010 For Santa Fe County as Compared to City of Santa Fe


BDD Business Model


June 2011 Estimated per Capita Gallons Used

City of Santa Fe 3,235 gallons per capita

Santa Fe County (gross)

393 gallons per capita (low)

BDD Business Model


San Juan Chama Water RightsJPA afy gallon/af Total gallons/year

5,230 325,851 1,704,200,730

1,700 325,851 553,946,700

1,800 325,851 586,531,800

8,730 2,844,679,230

Peak Day Diversion CapacityFOPA

% MGDCity Percentage indicated in the FOPA 62.09% 11.3 mgdCounty Percentage indicated in the FOPA 20.33% 3.7 mgdLas Campanas Separate indicated in the FOPA 17.58% 3.2 mgd

18.2 mgd total

DefinitionsBudget

FundLine Item

Managerial Accounting (Job Cost)Fixed CostVariable Cost

ActivityServiceProject

Program


DefinitionsBudget One of the most

important administrative tools, a budget serves also as a (1) plan of action for achieving quantified objectives, (2) standard for measuring performance, and (3) device for coping with foreseeable adverse situations.

DefinitionsFund Accounting entity

(similar to a bank account) for recording expenditures and revenues associated with a specific activity.

DefinitionsLine item A budgetary unit that is

uniquely identified and segregated from others.

DefinitionsManagerial Accounting Activity-based costing

A methodology that measures actual cost of any activity by combining direct and indirect costs for all.

DefinitionsFixed cost A periodic cost that remains unchanged

irrespective of the output level, such as depreciation, insurance, interest expense, salaries, benefits and other wages.

While in practice, all costs vary over time and no cost is a purely fixed cost, the concept of fixed costs is necessary in short term management.

Organizations with high fixed costs are significantly different from those with high variable costs. This difference affects the financial structure of the organization as well as its pricing and profits. The breakeven point in high fixed cost organizations is typically at a much higher level of output, and their marginal profit is higher.

DefinitionsVariable costs Driven by (vary with) the

rate and level at which output is produced.

As output goes up, total variable costs go up.

Breakeven point is low.Marginal profit (the

profit per unit) is low per unit.

DefinitionsActivity A process undertaken by an

organization to convert inputs into outputs.

DefinitionsService An intangible: something

of value that is given and received, or produced and consumed, during a measurable period of time.

Not stored, that is, we can’t inventory it.

DefinitionsProject Planned set of

interrelated tasks to be executed over a fixed period and within certain cost and other limitations.

DefinitionsProgram A plan of action aimed at

accomplishing a clear business objective, with details on what work is to be done, by whom, when, and what means or resources will be used.

FY2012 BudgetBDD is a very high fixed cost

organization. The cost structure is relatively high and cannot be radically changed in order to achieve the desired level of output.

Additional costs must be carefully scrutinized.

In high fixed cost organizations, a lack of cash flow can severely hamper operating effectiveness.

Breakeven point Units = (Total Fixed Costs)/ (Sales Price per unit – Variable Cost per unit)

Breakeven point units X price = Breakeven revenue

BDD has a monthly production and a monthly budget.

Efficiency is extremely important.

Our costs should be easy to predict as they are mostly fixed costs.

Bdd Financial Training For Sr Mgt Team Bdd Partners And Business Model

Documents

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