What is not permitted in the preparation of the municipal budget regarding anticipated revenues?

In the preparation of the municipal budget, relying on projected values above last year's earnings is not permitted. This approach can lead to unrealistic expectations for revenue collection and potentially create budgetary shortfalls. The municipal budget should be based on a conservative and realistic assessment of revenue, which involves analyzing historical data and considering economic conditions, rather than making assumptions based on overly optimistic projections.

When preparing a budget, it is essential to utilize revenues that have historically been realized or are more secure due to their basis in contracts or specific agreements. Including revenues solely based on past performance provides assurance that the budget is grounded in reality. Therefore, anticipating revenues that significantly exceed prior earnings does not align with sound financial practices or the regulations that govern the budgetary process.

In contrast, the inclusion of only those revenues cash realized from the previous fiscal year, excluding minor sources of income, or relying on revenues supported by contracts are approaches that maintain fiscal responsibility and transparency, ensuring that the budget is both valid and achievable.