Line item budget

A line item budget is a form of budget presentation that clusters proposed expenses by department or cost center. This method of aggregation more easily shows which departments and cost centers are absorbing the bulk of the entity's funds. The presentation typically shows the actual expenditure or budget from the prior period for comparison purposes, so that one can quickly see if there are significant changes budgeted from the prior period. This format represents an easy way to roll forward the budget into a new period. However, the simplicity of the roll forward may encourage users to not delve more deeply into the numbers, so that existing budgets tend to be perpetuated into the future.