Who is typically involved in preparing and approving the annual budget?

• A. The president alone
• B. The finance committee or treasurer and the membership or governing body
• C. External auditors
• D. No formal budget process

Answer: (D)

Budgets come from a collaborative process that blends financial stewardship with governance oversight. The people most responsible for drafting the plan are the finance committee or the treasurer, who have the expertise to project revenues and outline expected expenses based on past results and future goals. They don’t set the plan in isolation; the budget is developed with input from the organization’s leadership and then presented to the membership or governing body for review and formal approval. This ensures there’s accountability and alignment with the organization’s mission and priorities.

External auditors play an important role, but they are not the ones who prepare or approve the budget. Their job is to review financial statements and internal controls after the fact to provide assurance to stakeholders. Relying on a single president to handle the entire budget ignores the necessary checks and balances, and having no formal budget process would leave financial planning and oversight unmanaged.