Skip to content Skip to navigation

How University Budgets Work (Review)

Tomorrow's Academy

Message Number: 

Given the growing number of emerging issues currently facing higher education, ranging from demographic changes to shifts in public and private funding, this book provides an important starting point for members of the campus community to prioritize, plan, and manage how resources are allocated at their respective institutions.




The posting below is a review by Salvador D. Aceves, EdD* of the book, How University Budgets Work, by Dean O. Smith, Johns Hopkins University Press, Baltimore, MD, 2019, 200 Pages, ISBN 9781421432762. The review appeared in Planning for Higher Education. Volume 49, Number 1, October – December 2020. Society for College and University Planning Copyright © 2021Society for College and University Planning. All Rights Reserved. Reprinted with permission.




Rick Reis

UP NEXT: Just Because We Can Doesn't Mean We Should – Lessons in Digital Learning



Tomorrow’s Academy


---------- 791 words ----------


How University Budgets Work (Review)



This book serves as a primer for establishing a baseline by which academic leaders can participate in conversations regarding finances at their institutions. As institutions increase the level of engagement among faculty, staff, administrators, students, and governing board members, it is helpful to ensure that new and continuing members possess the necessary vocabulary, understand the core concepts, and are familiar with the different financial frameworks used in higher education. Overall, the author takes great care in maintaining fidelity to accounting principles, while also providing context for the way in which university budgets are developed. His careful use of technical language helps present complex topics in a way that is understandable to the reader.

Given the growing number of emerging issues currently facing higher education, ranging from demographic changes to shifts in public and private funding, this book provides an important starting point for members of the campus community to prioritize, plan, and manage how resources are allocated at their respective institutions. Over my many years of working with budgets, I find those that are most effective are the ones that best reflect the collective priorities of the institution. The author provides readers with the tools and insights necessary to help them become active members of the budget process and to become effective stewards of the process that shapes this vital work.

Section: The Language of Budgets

The author shares a comprehensive, yet accessible, financial framework that allows the reader to better understand the language and budget structures commonly found at most institutions of higher education. He puts accounting terminology into proper context through a series of illustrative examples. The author peeks behind the curtain and reveals the information that typically flows through the institution’s financial system. I found the examples relevant and useful and an excellent way by which to preview actual potential situations that institutions may face during a typical academic year.

Section: University Budgets

Insightful comments frame the human dimension of budgets and the budget-creation process. I was particularly impressed with the clarity the author provided in reviewing complex budgets. It is not uncommon for budget committees to spend significant amounts of time discussing and debating competing priorities. The author uses examples to highlight how tradeoffs ultimately shape and guide the budget-creation process. Emphasizing how budgets are a social construct is an honest and realistic way to describe the impact of the budget on the institution.

Section: Budget Models

One of the strengths of this section is the author’s overview of different budget models. There was great care given not to bias the reader toward any particular budget model, and the author spent time highlighting both the strengths and weaknesses of each. Helpful and insightful comments based on lived experiences were also provided. I found the thought-provoking questions included at the end of this section to be most beneficial.

Section: Strategic Plans

Linking strategic plans with the budget is generally considered the hallmark of the budget process. The author does a good job describing the importance of a strategic plan and the need for budgets to reflect institutional priorities. This is an excellent segue for the reader to learn more about the critical link between plans, budgets, and the planning process. Finally, I was pleased to see a section on budget alignment. While much of the discussion focused on vertical alignment, helping readers[EH1]  recognize the importance of placement will prepare them for a subsequent conversation about the different types of alignment that are possible.

Section: Operating Budget Preparation

Generally, institutional leaders would have no reason to spend time reviewing the process and steps that are needed in formulating a budget. Yet, this process provides the user with a better understanding of the limitations that budgets can present to a department or unit. While it would have been easy to overwhelm the reader with minutia, the author, instead, focused on the various budget users across the institution and how the governance process helps shape and guide the budget.

Sections: Budget Implementation and End of the Fiscal Year

The author dives deeper into the mechanics of implementing a budget. This includes reviewing how changes in assumptions and actual performance leads to budget modifications. How one reacts to these factors plays an essential role in understanding how, to some, budgets are considered to be limiting and static, and, to others, they are deemed to foster creativity and flexibility.

Section: Power of the Budget

In summary, the book serves as a wonderful way by which to introduce and deepen the understanding of the importance of finances to the institution. By learning the vocabulary, core concepts, and frameworks that guide the development of the institutional budget, readers will be better prepared to participate and engage in their respective institution’s budget development process.



Salvador D. Aceves, EdD, was promoted to senior vice president and chief financial officer and professor of accounting at Regis University in May 2015. Prior to that appointment, he was the associate vice president for academic financial planning in the Office of the Provost at Fordham University. Formerly, he was vice provost at the University of San Francisco, and held a faculty position as associate professor of accounting.

Engage with the Reviewer To comment on this review or share your own observations, email






 [EH1]Plural to match “them”