A university (Enormous Public University) has the following line items in its traditional budget…

➤ Why is assigning spending to program categories difficult, especially for shared costs?
Shared costs—administration, facilities, IT, and libraries—span multiple programs and resist neat assignment. Units dispute allocation bases like FTE, credit hours, or square footage. Expect data gaps and political pushback. Use cost pools, clear allocation formulas, activity-based costing pilots, and regular recalibration to improve fairness and accuracy.