Programme and budget projections

How programme and budget projections are evaluated

Programme evaluation

• Will the proposed programme deliver to the Investment Feature Outcomes we’ve agreed for your organisation?
• Does the proposed programme match your wider organisational goals for next year?
• For Tōtara organisations, will it also fulfil the requirement of contributing to sector capability and development?
• Does the proposed programme seem viable? For us, viability means having the skills, people, track record and money to deliver the programme sustainably. 

Budget evaluation

Part of the programme viability question includes checking on the financial health of your organisation. The things we'll consider here are:

• Is the organisation projecting a surplus or a deficit? We'd prefer to see a positive result projected for the year, but we know that planned deficits are sometimes the reality of doing business.
• If a deficit is planned, we'll consider whether:
  • the result is normal for the organisation (e.g. due to its normal operating cycles),
  • the organisation has the resources to support a shortfall,
  • the organisation's governing body has approved this result.
• How do these projections compare with previous years' results? Is anything significant changing?

We might reserve our approval of your budget projections until this year’s results are known, as that sets the scene for the viability of next year’s projections.

Ratings and outcomes

Advisers will give ratings for the Programme and Budget projections. These are similar to a traffic light system:

• Met expectations - Green - P&B is approved and next year's payments are good to go. 
• Minor reservations - Amber - we’re a little worried about something.
  • We might conditionally approve the projections, which means you may have to supply extra info (like a letter from your board approving a deficit/use of reserves), but we’ll still progress with the January payment. 
  • Or we might approve the projections (and process next year’s payments) but we’ll flag our concerns with you so we can keep an eye on them and work on resolving them together. 
• Major reservations - Red - the programme and/or budget projections present too big a risk for us and we need something actioned before we can approve them or commit to next year’s payment schedule.

Variations to approved programmes and budgets

We understand that plans can change throughout the year, and this could affect what we’ve agreed for your CNZ Funded Activities. Our Funding Agreement provides some scope to make variations.

For us, there are two types of variation - major and minor and they help us manage risk.

Minor variations

Minor variations are things like dates, venues, people etc. They are aspects of your activity that won’t have a substantive impact on the programme or budget we’ve agreed. You can make these changes and, if relevant, let us know about them in your next report.

Major variations

A major variation requires approval from the Manager, Investment Services, and will have one or more of the following impacts on the agreed programme and budget:

• Substantive changes to the approved programme (e.g. removing, replacing or adding an activity).
  • If you want to remove an activity, we might need to talk about the perceived return on our investment.
  • If you want to replace an activity, we’d want to check that the new activity delivers to the outcomes we’re funding you to generate and that it meets our funding guidelines (e.g. is something we can fund).
  • If you want to add an activity, we’d want to have a conversation about your capacity to deliver to avoid burnout.
• Substantive changes to locations, key participants or anything that changes the kaupapa, outcome, or viability of the activity.
• Substantive reduction (e.g. more than 10%) to your overall programme projections (e.g. # of new works, events, copies, participants, attendees etc);
• Substantive reduction (e.g. more than 10%) to your organisation’s overall financial projections for the year;

Generally speaking, we won’t stand in the way of change unless there is a fair reason, and we’ll discuss it with you before reaching a decision.

If in doubt about which type of variation is appropriate contact your Investment Services Adviser.