City of Laguna Niguel Adopted Budget For Fiscal Year 2024-25 BUDGET GLOSSARY ACCOUNTABILITY: The state of being obliged to explain one’s actions, to justify what one does. Accountability requires governments to answer to the citizenry -- to justify the raising of public resources and the purposes for which they are used. ACCRUAL BASIS: Revenues are recognized when earned, and expenses are recognized when incurred. APPROPRIATED BUDGET: The expenditure authority created by the appropriation bills or ordinances, which are signed into law, and the related estimated revenues. The appropriated budget would include all reserves, transfers, allocations, supplemental appropriations, and other legally authorized legislative and executive changes. APPROPRIATION: Amount of money budgeted for a given program. Appropriations do not mean the money will be fully expended but are the means by which legal authority is given to expend public monies. ASSETS: Property which has monetary value and is owned by a government. AUDIT: A systematic examination of resource utilization concluding in a written report. It is a test of management’s internal accounting controls and is intended to: (1) ascertain whether financial statements fairly present financial position and results of operations; (2) test whether transactions have been legally performed; (3) identify areas for possible improvements in accounting practices and procedures; (4) ascertain whether transactions have been recorded accurately and consistently; and (5) ascertain the stewardship of officials responsible for governmental resources. BALANCED BUDGET: A budget in which available resources exceed or equal expenditures. BASIS OF ACCOUNTING/BUDGETING: A term used to refer to when revenues, expenditures, expenses and transfers – and the related assets and liabilities – are recognized in the accounts and reported in the financial statements. The City utilizes the modified accrual basis of accounting for the General Fund and all other Governmental Funds, and the accrual basis of accounting for the Vehicle Replacement Internal Service Fund. BUDGET: A plan of financial and program operation which lists appropriations and the means of financing them for a given time period. BUDGET ADOPTION: Formal adoption by the City Council which sets the spending path for the year. BUDGET CALENDAR: The schedule of key dates or milestones that a government follows in the preparation and adoption of the budget. BUDGETARY CONTROL: The control or management of a government or enterprise in accordance with an approved budget for the purpose of keeping expenditures within the limitations of available appropriations and revenues. 119