Setup budget control

This article describes how to setup the budget control in Dynamics AX 2012. Budget control is a method of enforcing that sufficient budget funds are available for planned or actual purchases. The setup of the budget control content a temporary version and an active version. You need to set up basic budgeting before configuring budget control.

Budget control set up: 

Step1: Define financial dimension to use for the budget control

Access : Budgeting > Setup > Budget control configuration > Define parameters

• Select the account structure to use.
• Select the financial dimensions for budget control from the financial dimensions that you defined for budgeting: select the dimension and move it to the Budget control dimensions list.

Step 2: Define parameters

Access : Budgeting > Setup > Budget control configuration > Define parameters

• Define a budget control interval, such as Fiscal year or Fiscal year to date. The budget control interval works with the budget cycle to determine how amounts are aggregated for budget checking.
  • Fiscal year: all the funds for the fiscal year are aggregated for budget checking
  • Fiscal year to date: the ending date is determined from the fiscal period and the accounting date of the source document or accounting journal that is being checked.
• Define the budget cycle time span, which defines the length of the budget cycle
• Define a budget manager, which is a user who can approve budget workflows. Another budget manager can be defined by using a budget control rule.
• Define the percentage of the budget that can be spent. And select the Display a message when exceeding budget threshold check box to display messages when the budget threshold is exceeded.

Step 3: Define over-budget permission for user groups

Access : Budgeting > Setup > Budget control configuration > Over budget permission

You can let specific user groups exceed the available budget or restrict user groups from exceeding the available budget or budget thresholds. The Prevent processing at over budget threshold setting is applied to all users who are not in a user group.

In the Over budget options field, select the appropriate option for this user group.

• Prevent over budget processing : Users in this group cannot process a budget register entry if the available budget balance is insufficient to cover the entry.
• Allow over budget processing: Users in this group can process a budget register entry if the available budget balance is insufficient to cover the entry.
• Prevent processing at over budget threshold: Users in this group cannot process a budget register entry if the financial dimension or main account will exceed its specified threshold to cover the entry.

Step 4: Define the calculation that determines the budget fond that are available

Access : Budgeting > Setup > Budget control configuration > Budget funds available

You can select check boxes to determine the amounts that are added to and subtracted from the budget funds that are available.The budget funds calculation is displayed under the check boxes.

• Original budget: Original budget register entries that have a document status of Completed.
• Budget revisions: budget register entries that add changes to original budgets and that have a document status of Completed.
• Draft budget revisions: budget register entries that add changes to original budgets and that have a document status of Draft.
• Budget transfers: budget register entries that transfer budget amounts from one financial dimension value to another and that have a document status of Completed.
• Draft budget transfers in: transfer budget register entries that increase the budget and that have a document status of Draft.
• Draft budget transfers out: transfer budget register entries that decrease the budget and that have a document status of Draft.
• Actual expenditures: actual expenditures that are recorded in the general ledger from expense reports, vendor invoices, and accounting journals (only when the source document or accounting journal is enabled for budget control).
• Unposted actual expenditures: actual expenditures that are not yet recorded in the general ledger from expense reports, vendor invoices, and accounting journals.

Step 5: Select source document for budget control

Access: Budgeting > Setup > Budget control configuration > Select source documents

In this area, you can determine the source documents that are subject to budget control. You should match the source documents that you select with the options that you selected for the budget funds available calculation in Budget funds available.

For each source document, you can select the “Enable budget control for line item on entry” check box to enable budget checking for each line as the line is entered and saved

Step 6: Select accounting journal for budget control

Access: Budgeting > Setup > Budget control configuration > Select accounting journals

In this area, you can determine the accounting journals that are subject to budget control. You can also enable budget checking for each line as the line is entered and saved.

Step 7: Assign budget model to budget cycle

Access: Budgeting > Setup > Budget control configuration > Assign budget models

You can assign a budget model to a budget cycle to perform budget checking for the budget cycle. Only one budget model can be in use for a budget cycle.

Step 8: Define budget control rules

Access: Budgeting > Setup > Budget control configuration > Define budget control rules

Budget control rules determine the financial dimension value combinations for budget control. The budget control rules are validated against the ledger accounts that are being used on source document accounting distributions and accounting journals. If the financial dimensions in the ledger accounts match the financial dimensions in the budget control rules, a budget check occurs.

• Criteria in two or more rules that cover the same financial dimension values are not allowed.
• If all financial dimension value combinations will be enabled for budget control, you can define a budget control rule without criteria.

Step 9: Select main account

Access: Budgeting > Setup > Budget control configuration > Select main accounts

If the main account financial dimension is not defined for budget control, you can select the main accounts that the budget control rules will be enforced for. Only main account types of Total, Profit and loss, and Expense can be selected. The budget control is working only for total account  linked to Expense or Profit and loss accounts.

If the main account financial dimension is defined as a budget control dimension, the main account financial dimension is included in the budget control rules, and this setup step is not required.

Step10: Define budget group (optional)

Access: Budgeting > Setup > Budget control configuration >

In the Define budget groups area, you can define budget groups to form a budget pool, or a collection of financial dimension values whose budgets will be pooled for a secondary budget check.

The financial dimension combinations that are found in the budget control rule are always checked for budget amounts. If a financial dimension combination is also found in a budget group, a second budget check is performed at the budget group level.

Step 11: Define message levels for user groups

Access: Budgeting > Setup > Budget control configuration > Define message levels

You can specify that budget control warning messages will not be displayed for selected user groups. Users in the selected user groups will continue to receive error messages based on their over budget permissions.

Step 12: Active the budget control

Access: Budgeting > Setup > Budget control configuration > Activate budget control

When you turn on budget control, the active budget control configuration takes effect.

When budget control is on, users have a message when a transaction exceeds the budget funds

Setup Budget: presentation

This article describes how to setup the budgeting module in Dynamics AX 2012. Before setting up budget in Dynamics Ax, you should prepare or identify:

• financial dimensions and accounts to use in the budget.
• currencies and exchange rates to use in the budget.
• budget codes to use.
• define which budget transactions need workflow approval.
• budget model names.
• budget cycles.

The setup of  the budgeting module, contains several steps:

• Setup parameter and sequence number
• Setup exchange rate for budget
• Setup financial dimensions to use for budgeting
• Create budget model
• Create budget code
• Create budget transfer rules
• Setup budget allocation rules
• Setup Budget Cycle

1/ Budgeting parameters

Access: Budgeting > Setup > Budgeting parameters

• In the budget tab,
• Select a period allocation key for cash flow forecasts,
• Select the “Use rules for budget transfers” check box to enable budget transfers.
• Select revenue budget options,
• Select whether to process budget register entries when they are transferred from project, fixed assets, demand forecast, or supply forecast budgets to general ledger budgets.
• If the posting definition is active,  select a budget journal to use for budget appropriations.

• In the tab number sequences, select the number sequence code to use for the budget entries.

2/ Exchange rate for budgeting

Access: GL > Setup > Currency > Currency Exchange rates

• Setup exchange rate for budget: you can for example use a monthly rate for the budget.
• Select the type for budget
• Enter exchange rates for currency used in Budgeting

• Select exchange rate type in the ledger parameters
• Access: GL > Setup > Ledger

3/ Financial dimension for budgeting

Access: Budgeting > Setup > Dimensions for budgeting

• Setup dimension to use for budget
• Select all the dimensions to use in the budget

4/ Budget models

Access: Budgeting > Setup > Budget models

• You need to setup at least one budget model.
• Or you can create severals budget models and submodels.
• Budget models are used in the reporting

5/ Budget codes

Access: Budgeting > Setup > Budget codes

• Create several budget codes to order transactions by budget types
• The budget code are used in the setup of the budget workflow.
• Select a type of budget : original budget, transfer, revision, fixed assets, …

6/ Budget transfer rules

Access: Budgeting > Setup > Budget transfer rules

• Create budget transfer rules to allow transfer between two budget dimensions.

7/ Budget allocation terms

Access: Budgeting > Setup > Budget allocation terms

Use the Budget allocation terms form to define the financial dimension values and the percentages that are used to generate budget allocations. These budget allocation terms provide an automated way to distribute percentages of budget amounts across financial dimension values.

• Click New and enter a budget allocation code and a description
• Click Add and enter the percentage of the total amount that is allocated and the destination (financial dimensions).
• Create as many lines that you need.

8/ Budget cycles

Access: Budgeting > Setup > Budget cycles

Use the Budget cycle time spans form to specify the fiscal year or the number of periods for the budget cycles that are associated with the budget cycle time span. Budget cycle time spans are associated with fiscal calendars to determine the length of each budget cycle.

• Click New and enter a name for the budget cycle,
• Select a fiscal calendar to associate with the budget cycle,
• In the Length of budget cycle field, select Specify number of periods and  enter the number of accounting periods for the budget cycle or select Map to fiscal year.
• Click Add and enter the name of the first period in the budget cycle.
• Enter the date when that period starts. The ending date for the budget cycle is determined automatically based on the number of fiscal periods in the budget cycle.

Create a budget transfer

This article describes how to enter a budget transfer in Dynamics AX 2012.

1/Create a budget transfer

You can create budget transfers by creating a budget register entry that has a budget code that is associated with the Transfer budget type. You decrease the budget of one or more financial dimension values, and then increase the budget of other financial dimension values by the same amount.

Access: Budgeting > Common > Budget register entries > New

• In the Budget register entry tab, select the budget model and the budget code with a budget type = transfer

 

• In the Budget account entries grid, click Add line.
• Enter the account structure and financial dimension values to transfer a budget amount from (negative amount)

• Enter a second line with the account structure and financial dimension values that you want to transfer the budget amount to (positive amount)

• Click on Update budget balances to valid the transfer
• Remark: If workflow is activated for the budget code, a message informs you that the budget transfer request was submitted to workflow.

2/ Create a budget transfer when you are creating another entry

You can create a budget transfer when you are creating a budget register entry. In this case, you can create a transfer from any of the budget types, such as Original budget or Revision.

Access: Budgeting > Common > Budget register entries > New

• In the Budget register entry tab, select the budget model and the budget code (like a regular entry).

• In the Budget account entries grid, click Add line.
• Enter the date, account structure, financial dimension values, amount, and amount type. And save the line
• Click on Create transfer

• In the “Create Transfer” form, select the destination of the transfer in the top of th form, and create a line for the source of the transfer.
• The transaction total should be equal to 0.
• Click on “Update budget balances”

• Click on “Update budget balances” to enter the budget entry.

In Budgeting > Inquiries > Actual vs Budget, you can check the value of the budget.

• In the tab “Select”, enter a new filter with the budget value

• Select other options (Budget model, fiscal year, …) and click on “Update totals”
• In this example, I have an original entry = 10 000 and 2 transfers (1st = -5000 and 2nd = -400).

Create a budget entry

This article describes how to enter a budget manually in Dynamics AX 2012.

Create a budget entry

Access: Budgeting > Common > Budget register entries > New

• In the “budget register entry” tab, select : a budget model, a budget code and the date for the budget period.
• In the “budget account entries” tab, click on “Add line” and enter : the account structure, the account and dimension (depends of dimensions set up for budgeting) and the amount of the budget.

• When all the entries are written, click on “Update budget balances”. If the budget balances are not updated, the status of the budget is “Draft” and not “Completed”.