Which statement best describes the distribution of funds in the governance structure described?

• A. Cost Center Managers receive funds directly and distribute to program offices.
• B. Budget Officers distribute funds to all units.
• C. Responsibility Center Managers, who in turn pass funds to Cost Center Managers, receive funds first.
• D. Program Administrators manage fund distribution to vendors.

Answer: (C)

In this governance setup, funds flow through a chain of responsibility so that accountability is built into every level. Responsibility Center Managers hold authority over a broad set of resources and are tasked with allocating funds to the units that execute programs. Those managers receive the funds first and then pass portioned funds down to Cost Center Managers, who handle the day-to-day costs of specific activities. This sequencing ensures that resource distribution aligns with overall objectives and that each level can be evaluated for performance and control. Distributing funds directly to program offices, diverting allocation to all units by budget officers, or having program administrators pay vendors would bypass this control framework and weaken accountability, which is why the statement describing funds arriving first to Responsibility Center Managers and then to Cost Center Managers is the best fit.