ABSTRACT
This chapter outlines the different approaches taken to resource allocation and financial forecasting and hopes to demonstrate the value and insight that can be gained from the strategic planners' understanding and contribution to financial modelling and resource allocation. Translating the strategy into financial planning and demonstrating that the institution is on track to deliver its targets relies on a system of financial forecasting and monitoring. Both contribution and full cost models allocate all of the income earned by income-generating areas to that unit; the difference is in how costs, in particular central institutional costs are treated. Most institutions have insufficient connectivity between the student information system and the finance system for income to be allocated module by module in accordance with fees actually paid. The model for allocating income can also be used to allocate other specific costs, for example overseas recruitment agents' fees and central admissions and registry costs.
