STEP 4: To calculate the salary cost per period, multiply the base salary by the number of full-time equivalents and enter the dollar amount into the corresponding period.

STEP 5: Calculate the fringe benefits and enter in the appropriate row.

STEP 6: Add the salary cost per period and the fringe benefits per period, downward to find the total personnel resources expenses per period and then across to find the total personnel resources expenses for the year.

The second part of the worksheet is concerned with other resources. Completing this part involves three steps:

STEP 7: Refer to the WORKSHEET FOR ESTIMATING NONPERSONNEL RESOURCE REQUIREMENTS and list each other resource. Again make note of the general ledger and resource codes and record the worksheet number on which the original assumptions are made.

STEP 8: For each resource, estimate the anticipated cost.

STEP 9: Add other resources expenses estimates down to obtain totals per period and then across to obtain a total for the year.

When all three parts of the Worksheet have been completed, estimated expenses are totaled downward to determine total expenses for the year for the functional cost center. When the WORKSHEET FOR ESTIMATING FUNCTIONAL COST CENTER OPERATING EXPENSES has been completed for all functional cost centers, they are aggregated by line item into a composite expense budget for the entire AAA. Exhibit IV-3 is a sample aggregate expense budget.

EXHIBIT IV-3

WORKSHEET FOR SUMMARIZING AAA OPERATING EXPENSES BY FUNCTIONAL COST CENTER AND RESO

CATEGORY WORKSHEET #:

V. DEVELOPING THE PROGRAM PLAN:
PREPARING THE REVENUE BUDGET

Of course, the expense budget is not prepared in a vacuum because AAAs have a general idea of their future revenue when they plan the scope of their program. The revenue budget must be set out in detail, however, to assure that funds are adequate to cover projected expenses. This Chapter explains how to project revenues and prepare a revenue budget, discusses client contributions as a revenue source, and identifies issues to be addressed in collecting client contributions and developing a sliding contribution schedule.

Each AAA must systematically project the revenues from OAA grants; other Federal, State, and local government sources; client contributions; donations; business-related income; and other program income. Projections about grant revenue can be made most easily on a yearly basis and then distributed among the quarters to reflect expenditure requirements. Projections about donations and client contributions should be projected on a quarterly basis to reflect seasonal trends in giving and service utilization.

Projections by source result from AAA assumptions concerning each payment source. These vary widely by source, by AAA, and by year and depend also on:

The AAA's approved area plan and budget

Federal funding levels

State and local match levels

The economy (which influences client contributions and donations)

Fund raising strategy

Socioeconomic status of client population

Exhibit V-1 is a WORKSHEET FOR PROJECTING AAA OPERATING REVENUES. It provides space to document each revenue budget assumption and illustrates the level of detail and type of reasoning that should be included in each AAA's revenue budget.

The most difficult and controversial revenue to estimate is program income, including client contributions. Program income (sometimes referred to as grantrelated income) is defined in 45 CFR 74.41 as "gross income earned by a recipient from activities part or all of the cost of which is either borne as a direct cost by a grant or counted as direct cost toward meeting a cost-sharing or matching requirement of a grant." Program income typically is derived from: client contributions, proceeds from the sale of real or tangible personal property (including craft shop items), royalties or allowable interest income.