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• <br /> RECOMMENDED PRACTICE <br /> Adoption of Financial Policies (2001) <br /> Background. The National Advisory Council on State and Local Budgeting(NACSLB) <br /> has developed a comprehensive set of recommended budget practices. The <br /> recommendations have been endorsed by a number of key governmental associations,by <br /> academia and by labor groups associated with state and local governments. These <br /> practices and the associated framework outline a budget process that encompasses the <br /> broad scope of governmental planning and decision-making with regard to the use of <br /> resources. This work is recognized as one of the most important advances in <br /> governmental finance in decades. The Government Finance Officers Association(GFOA) <br /> has adopted a recommended practice endorsing the NACSLB practices and the associated <br /> framework. However,the policies included in this Recommended Practice are those <br /> considered fundamental to the budget process and relevant to the broadest number of <br /> jurisdictions. <br /> • The work of the NACSLB provides a framework for describing the overall budget <br /> process. The framework is organized around the four principles of the budget process: <br /> • Establish Broad Goals to Guide Government Decision Making <br /> • Develop Approaches to Achieve Goals <br /> • Develop a Budget Consistent with Approaches to Achieve Goals <br /> • Evaluate Performance and Make Adjustments <br /> Each of these principles has additional elements that provide guidance for an effective <br /> budget process. Element#4, of Principle 2, Adopt Financial Policies, addresses the need <br /> for jurisdictions to establish policies to help frame resource allocation decisions. <br /> Recommendation. <br /> The Government Finance Officers Association(GFOA) recommends that, at a minimum, <br /> financial policies in the following areas be developed by professional staff and formally <br /> adopted by the jurisdiction's governing board as well as the governing boards of those <br /> component units; state,provincial and municipal corporations and organizations; and <br /> other bodies under their jurisdiction. <br /> • Financial Planning Policies <br /> • Revenue Policies <br /> • • Expenditure Policies <br />