Policies and Resources

Financial Analysis 

Financial analysis includes both operational and staff advisory functions related to the firm’s budgetary and financial performance. It involves budgeting, accounting, managerial-financial reporting, and related activities such as internal auditing and management analysis.  

Financial analysis involves activities such as formulating budget and price estimates to support plans, programmes, and activities. Financial analysts review and evaluate budget requests, review requests for apportionment and allotments, and review, manage, and report obligations and disbursements. They also present and defend budget estimates before fund reviewing and granting authorities.  

Financial analysis is an in-depth review of proposed and actual disbursements and revenues of a firm or programme. The financial analyst is involved with forecasting future trends in revenues or disbursements or determining future cash flows or budget requirements. Financial analysis involves assessing a firm’s financial position, including its fund balances and reserves, current and future cash flow needs, and current and future revenue flows. 

Financial analysts also analyse and make recommendations of the values and benefits of alternative methods for financing firm programmes and administrative operations. They implement legal and regulatory guidance over application of funds to support firm programmes and activities.  

Some financial analysts are responsible for examining, accepting, amending, approving, or rejecting the budget submissions and requests of firms, and developing and interpreting firmwide budgetary policies and practices.  

Financial analysis includes: 

  • Budget analysis. 
  • Assessments of financial condition and financing plans. 
  • Internal facility fund analysis. 
  • Activity value analysis. 
  • Financial modelling and projections. 
  • Prospective financial analysis. 
  • Revenue enhancement analysis. 
  • Operator fee/value recovery analysis. 
  • Application rate analysis. 
  • Analysis of contracting for services. 

The benefits of budget and financial analysis include:  

  • Evaluation of appropriateness of planned disbursement levels. 
  • Identification of revenue enhancement opportunities. 
  • Assessment of financial position before embarking on a multi-year capital project or expansion. 
  • Identification of excess fund balances or reserves. 
  • Identification of inadequate reserves for future rates.