At What Levels Can the Budget be Set

Budget Check Setup (BCS) is used to define the budget control rules for each account, or range of accounts, that have a budget allocation. Set up a budget check to link actual ledger accounts to the budget ledger accounts that contain their budget allocation.

You can define budget checks to link actual and budget accounts in the following ways:

  • at account level, to link a single ledger account to a single budget account. For example to check a building maintenance cost account against a budget allocated to this account
  • at a summary level, to link a group of ledger accounts to a single budget account. For example to check a number of advertising accounts against a total advertising budget allocation
  • at account/analysis code level, to link one or more actual accounts to a budget account where the budget values are set for selected analysis dimensions within the budget account.

You also determine for a budget check, whether the total committed expenditure should be included in the expenditure checking.

Checking Budgets at Account Level

You can define a budget for each account in your chart of accounts, and hold the budget values in the corresponding account in the budget ledger.

Alternatively, the budget for an account in your actuals ledger may be held in a different account in the budget ledger.

Checking Budgets at a Summary Level

You can define a high level budget and use this to control the expenditure for a range of actual accounts. For example, you might have a number of advertising expense accounts in your actual ledger that you want to monitor against a single, total advertising budget.

Enter the budget value into any account in the budget ledger within the corresponding range of actual accounts. For example, into the first account in the account range. You then define a budget check that selects the range of actual accounts and links them to the budget account that contains the total funds.

Checking Budgets at Analysis Code Level

You can also record and monitor budget values at an analysis code level, within a budget account. For example, if you want to maintain and monitor a marketing budget by department, where the department is identified in an analysis dimension on the ledger transactions.

When a ledger transaction is entered for the account code and analysis code combination, the transaction value is checked against the budget posted for the corresponding account/analysis code combination.

You can vary the type of budget checking that applies to selected analysis codes. When you define the analysis codes for a dimension using Analysis Codes (ANC), the Budget Checking option determines whether budget checking is allowed for an analysis code and if so, the type of budget checking required.

When a budget is held at the analysis code level, the following budget checking options can be set for each analysis code:

  • Budget Checking Not Required -Do not check the budget for this analysis code. For example, a marketing budget is spread by department but no budget is set for department X and no budget checking is required at all when marketing costs are entered for this department.
  • Allow Budget Checking - Check the budget for a combination of analysis code and account. For example, once department A's marketing budget has been exhausted, the budget checking facility looks to see if the marketing account has sufficient funds available. An over budget warning is only produced when both the departmental budget and account budget have been used. This checking is invoked if the Combined Budget Check option is set for the analysis code in Analysis Codes (ANC).
  • Allow Budget Checking at Account Level Only - Check the budget for account only. For example, a marketing budget has not been set for department Z, but a contingency budget has been set for the marketing account. Any marketing costs entered for department Z should be checked against the contingency budget held at the account level. An over budget warning is produced if the transaction exceeds the funds available for the marketing account.
Note: If you create a budget check setup for an account and analysis code combination that has no budget, all transactions posted to that combination are treated as over expenditure.