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PO5.3 - IT Budgeting

This topic is intended to enable collaboration and sharing of information to facilitate a better understanding and approach to implementing this COBIT control objective based on the risk, value and guidance provided by its corresponding control practices.

COBIT Control Objective PO5.3 - IT Budgeting is contained within Process Popup Manage the IT Investment

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IT Budgeting

Establish and implement practices to prepare a budget reflecting the priorities established by the enterprise’s portfolio of IT-enabled investment programmes, and including the ongoing costs of operating and maintaining the current infrastructure. The practices should support development of an overall IT budget as well as development of budgets for individual programmes, with specific emphasis on the IT components of those programmes. The practices should allow for ongoing review, refinement and approval of the overall budget and the budgets for individual programmes.

View value and Risk Drivers  help

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Value Drivers

  • An effective decision-making process for budget forecasting and allocation
  • Formally defined spectrum of funding options for IT operations
  • Identified and classified IT costs
  • Clear accountability for spending
  Risk Drivers
  • Resource conflicts
  • Inappropriate allocation of financial resources of IT operations
  • Financial resources not aligned with the organisation’s goals
  • Lack of empowerment, leading to loss of agility
  • Lack of senior management support for the IT budget

View Control Practices  help

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  1. Implement a methodology to establish, change and approve a formal IT budget, including all expected IT costs of IT-enabled investment programmes, IT services and IT assets as directed by the strategy, programmes and portfolios.
  2. When creating the budget, consider the following components:
    • Authorised sources of funding
    • Internal resource costs, including people, information assets and accommodations
    • Third-party costs, including outsourcing contracts, consultants and service providers
    • Capital and operational expenses
    • Cost elements that depend on the workload
  3. Document the rationale to justify contingencies and regularly review them.
  4. Monitor the effectiveness of the different aspects of budgeting (project cost allocation, service cost allocation and budget variance analysis), and use the results to implement improvements to ensure that future budgets are more accurate, reliable and cost-effective.
  5. Instruct process, service and programme owners as well as project and asset managers to plan budgets.
  6. Review the budget plans, make decisions about budget allocations, and compile and communicate the overall IT budget.

 

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Events & Online Learning: 3 total

7 May 2012
ISACA International Event
Orlando, Florida, USA
Get the knowledge you need to stay one step ahead of the competition and keep up with changing professional trends at ISACA’s North America CACS Conference.
10 Sep 2012
ISACA International Event
Munich, Germany
EuroCACS/ISRM is a multidimensional event featuring audit, security, governance and risk content, and the audit and security programs, tools and the resources you need to be responsive to industry changes.

Journal Articles: 242 total

Volume 3, 2012
by Aarni Heiskanen, LJK
A program or project portfolio explains how an organization is implementing its strategy with projects.
Volume 3, 2012
by Robert Findlay, CISA
Robert Findlay has had a 30-year career in a variety of IT roles, including computer operations, programming, project management, IT audit and emergency project management.
Volume 3, 2012
by Fabrizio Baiardi, Claudio Telmon, CISA, CISSP, and Daniele Sgandurra, Ph.D.
Haruspex is a risk evaluation methodology defined and implemented by the research group on risk management in the Department of Computer Science at the University of Pisa, Italy.
Volume 2, 2012
by Steven J. Ross, CISA, CISSP, MBCP
The Conference Board study addresses the resilience of companies “to bounce back from a disruption” caused by security events, which are defined rather loosely as environmental disasters, terrorism and cyberattacks.
Volume 2, 2012
by John P. Pironti, CISA, CISM, CGEIT, CRISC, CISSP, ISSAP, ISSMP
Risk and security will no longer be something that the organization consciously considers and instead will become integrated in business-as-usual activities.
Volume 2, 2012
by Kerry A. Anderson, CISA, CISM, CRISC, CGEIT, CISSP, ISSMP, ISSAP, CSSLP, CFE
The closer alignment between RIM and information security may provide an approach to managing increasing data protection concerns and tough privacy regulations rather than maintaining the separation between these critical compliance functions.

Wikis: 2 total

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