Plan for basic budgeting and budget control

  • 4 minutes

Plan basic budgeting

When using basic budgeting in Finance, you need to compile information about how to set up the budgets before you begin the configuration.

The following list includes the information that you should compile before you begin setting up basic budgeting or budget control.

  • Compile information about which financial dimensions and main accounts you plan to use for budgeting and which can have amounts transferred to or from them. (Main accounts are optional, but most people use them.)

  • Define currency exchange rates and what those exchange rates are.

  • Set up budget codes for each budget type and determine which code is the default budget code.

  • Decide which budget register entries use workflows. You can assign workflows to budget codes. The budget register entries that are associated with a budget code that has an assigned workflow are automatically submitted to a workflow.

  • Provide the names of each budget model.

  • Choose how to set up the budget cycles.

  • Determine the amounts to allocate across periods or to other financial dimension values.

  • Select financial dimensions that have recurring amounts.

  • Decide which budget models you want to use in cash flow forecasts.

Plan budget control

If you use budget control, compile the following information in addition to the information in the Plan basic budgeting topic:

  • Financial dimensions that you want to include in budget control rules.

  • User groups that can post entries that exceed the remaining balance for a budget.

  • Source documents and accounting journals to allow for budget checking.

  • Financial dimensions and accounts that must have a budget threshold and what that threshold is. A budget threshold is the level of budget usage at which you can prevent posting or display warnings. For example, if the threshold is 80, you can warn a user during entry that 80 percent of the budget for the selected account has been used.

  • The formula for calculating the remaining balance of a budget. You can define the budget funds available calculation for each legal entity instead of always using the following calculation: Original budget - Actual expenses.

  • The interval, such as monthly, quarterly, or yearly, that you want to use to determine whether the available budget balance is enough to cover transactions.