The assumptions and the expectations of the budgeting systems in higher education are presented in an attempt to clarify the magnitude of the task of setting up a budgetary methodology. The assumptions of effective budgeting should be identical to the purposes of the institutions that are served. Developing a system around the acquisition, storage, and transmission of knowledge, however, involves translating qualitative variables into quantitative ones such as credit hours or learning opportunities, support of faculty research, and public service functions. Even more controversial are the expectations people have about college and university systems and budgeting methodologies. There are three categories of people involved: the users, the distributors, and the providers of education. Each has varying perspectives and conflicting expectations. Users expect sensitivity and flexibility; distributors expect equity and efficiency; providers expect austerity and accountability. The financial officer must set up systems that attempt to satisfy all of these. (JMF)