Finances

The city’s financial planning process

1. Strategy and spending limit decision

The City Council decides on the city’s strategy and spending limit in October. The spending limit refers to the ceiling for budget expenditure, and it defines the city’s spending policy for the next three years. The City Council’s spending limit decision includes performance targets and the amounts allocated to each sector based on the financial plan. The allocation of money to different city units is prepared within the scope of the spending limit decision.

2. Financial plan proposal

The Mayor prepares a budget proposal based on the committees’ proposals, available resources, and existing decisions on Espoo’s strategy and estimated spending limit. The city’s Executive Group finalises the proposal for a budget and financial plan.

The Mayor’s proposal is published in October.

3. Deciding on the budget

After the publication of the Mayor’s proposal, the City Board discusses the proposal and requests a statement on it from the Advisory Committee of the City Council. After receiving the statement, the City Board presents it to the City Council. The City Council decides on the city’s strategy, budget and financial plan in December.

4. Monitoring budget implementation

In connection with the guidelines concerning the validity of and compliance with the budget, a decision is also made on the monitoring of budget allocations, revenues and strategic objectives. The aim of monitoring the implementation of the budget is to give decision-makers sufficient information about the achievement of objectives, the sufficiency of allocated funds, actual revenues, and the year-end forecast.

5. Financial statements

The City of Espoo’s financial statements include an income statement, a balance sheet and related notes, a budget review, a report on operations, and consolidated financial statements. The City Board adopts the financial statements by the end of March and submits them to the auditor for auditing. The auditor draws up an auditor’s report by the end of May. The City Council discusses the financial statements by the end of June.