| # Budget Control Budget Control is an integrated information system that tracks and controls budget-related business transactions. Financial health is continuously monitored by capturing sources and uses of budgets as they are committed and realized. Real-time budget checking prevents unauthorized deficits. Budget Control is designed to integrate accounting and budgeting functions into underlying business processes. Accounting distributions are retrieved from the appropriate policy levels, such as requisition entities, vendors, or purchased commodities. The relationship between accounting and budgeted funds is automatically determined through roll up structures. Budget control policy Budget checking must be executed on documents (purchase requisition, purchase order, invoice, etc.) in ERP LN. The Budget Control Policy indicates if budget must be checked for a specific document type or business object. Based on a Budget Control Policy parameter the budget check must be executed for a line at the moment of document line entry (during save) or at the moment of approval of the document, for each line. Budget accounts A budget is constructed in a hierarchy using budget summary levels (nodes and levels). Each level consists of budget accounts and their budget amounts. A combination of a budget account and a budget amount can also be called a ‘bucket’. In turn, at the lowest level of the budget hierarchy, a budget account is linked to multiple combinations of ledger accounts and dimensions. The determination of the lowest level depends on the level of budget control required. The relation between budget accounts and general ledger is maintained in distribution tables. Budget structure Budget Structure is the hierarchy which contains all roll-up structures and budget accounts. A budget structure has a minimum of 5 roll-up structures or summary levels. On each summary level a budget can be attached to a budget account. A budgetary rollup structure defines the budget accounts and dimensions to which detail accounts used by procurement, receivable, and ledger documents roll up. Budget amounts can be recorded at any level in the budgetary rollup structure and for multiple branches within the same structure. They can be controlled by period or on an annual basis. The budget currency can be one of the home currencies. A budget account doesn’t have to be linked to the next higher level; it can also be linked directly to the budget structure itself. Receive exception notifications When an exception occurs, the notification is sent to the all registered users of the budget account. However, the users must have authorizations to modify the account. Budget Manager Dashboard - overview Budget Manager dashboard provides a complete overview of the budget accounts of a budget. It allows the managers to control and monitor all the budget activities of all the budget structures When an exception occurs, the notification is sent to the all registered users of the budget account. However, the users must have authorizations to modify the account. Budget balances You can review the types of budget balances for the selected budget account and budget period in the budget manager dashboard. The budget balances that must be updated for a transaction such as budget check, release, amendment and budget transfer. The types of budget balances are: Budget Allotment Commitment Encumbrance Receipt Expense Expense Budget transfers Budget transfers are two-sided transactions that shift equal amounts of budgets from one budgetary account to another. Both transfers and amendments generate an audit transaction in the budgetary transaction file and can only be executed if sufficient budget is available. Any transfer of the budget, for instance a transfer budget from one budget pool to another requires an audit trail. Also a reason code is needed to justify the budget transfer. Budget control adjustments A budget control adjustment is used for Retro-actively adjust budget transactions which can be an adjustment to a budget balance like the commitment or encumbrance balance (for example, accidentally budget check has been switched off). A budget control adjustment is also used to create opening balances and reservation of budget for a future transaction. Budget amendments Although a confirmed budget cannot be updated directly, amendments enable subsequent budgetary updates in a controlled way. All budget amendments must be recorded by a budget transaction. Budget amendments are one-sided transactions that increase or decrease budgets and hence available budget. Amendment control: it is required that all changes to a budget after it has been ‘locked’ are controlled by change/reason codes per user. Any amendment of the budget requires an audit trail. Also a reason code is needed to justify the budget amendment. Reconciliation of budget balance with GL balance Through a reconciliation report the general ledger transactions can be reconciled with the budget transactions. The selection input is the budget account (range), period, amount class and summary level. Via the document reference the corresponding ledger transactions are retrieved. The budget transactions with the exception status are included in the selection. Year end process The year end procedure allows you to move the budget amounts and the related budget transactions to a new budget in the new fiscal year, define a new budget or copy an old budget transaction and amount to a new budget. Compare budget balance You can display the budget balances for the selected budget and budget year. |