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How do you make an IT budget?

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Quick Answer

To make an information technology budget, create a spreadsheet that includes standard personnel and other expenses, as well as items specific to IT, including the costs of hardware, software, subscriptions and services, notes the Journal of Accountancy. Also include any project-specific IT expenditures for the budget period in the spreadsheet.

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Full Answer

In an IT budget spreadsheet, include hardware expenses such as equipment, hardware installation costs, and any other expenses related to maintaining the hardware and the warranties on the hardware, advises the Journal of Accountancy. Also include the cost of purchasing software, as well as any licensing and support costs associated with running the software. List separately the costs of subscriptions for services related to IT, such as training or cloud computing, and note along with the cost whether the expenditure is fixed or variable. Next, list the cost of services provided to the IT department by people such as advisers, consultants and service providers.

In a section separate from ongoing expenses, lay out the costs of any projects that will occur during the budget period that will require IT resources, as the Journal of Accountancy recommends. Also categorize for each item in the IT budget whether it is a capital, operating or project-funded expense. Capital expenses are items such as hardware purchases, major equipment repairs and major software upgrades, while operating expenses include subscriptions, maintenance and support. For each project-related item in the IT budget, note whether it is project-funded or if it is a capital expense.

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