Page 120 - DLIS003_LIBRARY ADMINISTRATION AND MANAGEMENT

Unit 6: Library Finance

Adequate and continuous supply of funds is necessary to sustain library and information Notes
services.

There are a number of sources like regular grants from parent organisations, ad hoc grants
from other organizations, grants from endowments, fees, subscriptions, sale of service,
etc., through which finance for libraries flows.

Libraries spend their funds on books and journals, salaries and allowances of their staff,
development of library, documentation and information services, building, equipment,
furniture, etc.
It is also necessary to estimate funds to be allocated to libraries. Three methods are generally
considered, viz., per capita method, proportional method, and method of details.

Libraries have, by and large, restricted their financial management to preparing a budget
and managing their operational fund to procure reading materials.

Most of the exercises of costing and cost benefit analysis are academic in nature and have
not led to any significant changes in decision making by librarians.
The economic theory of the library is still a little known phenomenon for many
practitioners.
A vast array of financial management techniques and tools is largely unexplored in the
library content.

6.6 Keywords

Breakeven Analysis: The point at which consumption expenditures have been just equal to
income.
Capital Budgeting: A budget which mainly covers items of current revenue and expenditure.

Economics: It is descriptive and concerned with what is and what ought to be. It deals with the
relationship of inputs to output and eventually to supply, demand, markets, sales, prices, value,
utility, etc.
Elastic: Ability to recover readily from depression, adversity or the like.
Financial Estimation: Estimating the amount of money required for running the services of an
Estimation institution.
Financial Forecasting: It involves a systematic projection of expected actions of management in
Forecasting terms of financial statements, budgets etc. using past records, funds flow behaviours,
financial ratios and expected economic conditions in the industry and the firm.
Financial Management: An element of management dealing with acquisition, distribution and
Management utilisation of funds.
Library Expenditure: Money spent by a library on different heads such as purchase of reading
Expenditure materials, salaries and allowances, stationery, postage, furniture, equipment, etc.

Library Finance: Sources of financial flows and expenditures.
Library Income: Funds which accrue to a library from different sources such as grants, membership
fee, endowments, fines, service charges, sale of publications etc.

Macroeconomics: This is an industry and national level economic system with the objective of
maximising profit, e.g., Economics of information and information industry.
Microeconomics: This is concerned with the behaviour of individuals, firms and markets.

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