where to declare variables??

[ACCBAJPA]

guys, I am using a hybrid framework, do we need to use option explicit as the best practice in framework?? also I need to know where do we need to declare the variables, all the variables at the start of the script, or just before they are used, also for function library we need to declare the variable at the start of each function or in the beginning of the library all together? which of the following is proper.

Code:

Dim x,y,z
Function fun_abc(a,b,c)
------
End Function

OR

Function fun_abc(a,b,c)

Dim x,y,z
------
End Function