What describes a 'continuation budget'?

A continuation budget is a financial plan that extends the previous budget beyond its expiration. This type of budget typically includes all the previously allocated expenditures without significant changes, allowing for the continued funding of existing programs and services until a new budget is enacted. This approach is particularly useful in governmental and public sector contexts where it ensures that operations can proceed smoothly without interruption, even if a new budget is still under development or approval.

Continuation budgets are important for maintaining service delivery and operational stability during transitional periods. They do not introduce new funding for additional initiatives or changes but rather ensure that existing obligations and services remain funded. This stability is critical in local and municipal finance, where budgeting is often cyclical, and the approval process for new budgets can be lengthy and complex.

The other options do not accurately capture the essence of what a continuation budget represents, as they reference different types of budgeting scenarios or requirements that do not align with the concept of extending prior budget allocations.