Recommendations for front end split using budgets

This topic shows our recommendations for setting up budgets for front end split:

Separate budgets for direct and indirect expenses

The front end split calculation is based on these fields from the project funding source:

  • Priority
  • Percent
  • Funded Amount
  • Funding Group.

The remaining funding is tracked on the project funding source. The remaining funding is the funded amount minus the invoiced amount. The remaining expenditure is not tracked on the project funding source.

The budget template is used in the budget edit check for the calculation for front end split. The expenditure is compared to the remaining budgeted amount from the budget group data. This comparison ensures that expenditures do not exceed the budgeted amount.

Indirect burden expenses are not calculated when the transaction is created. The budget edit check is not performed when the indirect burden expenses are created. If the direct and indirect accounts are combined in the budget, then the entire amount can be applied to direct cost transactions or commitments. The indirect budget portion of the budget may not be available when indirect burdens are generated.

Separate milestone account or a summary account

If you use milestones, then we recommend that they are tracked and accounted for in a separate budget account or summary account. Milestone invoice amounts are not processed during distributions for front end split. When invoices are generated or journalized, a budget edit check is not performed. Milestone invoice amounts are not added to the budget group totals

Budgeted amount and funded amount are identical

The budgeted amount and the funded amount on the project funding source should be identical. The remaining budgeted amount is the sum of the committed and actual expenditures. The remaining amount is not tracked on the project funding source. The remaining funding amount is calculated by subtracting the invoiced amount from the funded amount. This amount is tracked on the project funding source.

When invoices are generated or revenue is recognized, the funding source is not split again if it is included on the GLTransactionDetail record. The remaining funding amount and the posting project maximums are validated. If the remaining funding amount does not equal the remaining budgeted amount, then the invoice record can be partially billed.