Budgets

Planning Spend Before It Happens

A budget lets you set planned income/expense targets for a period and then continuously track actual performance against them — turning "did we overspend on marketing this quarter?" from a manual spreadsheet exercise into a live report.

Core Concepts

Budget Statuses

• Draft – being built.
• Confirmed – submitted for approval.
• Validated – approved and active for tracking.
• Done – period closed.
• Cancelled.

Tracking Performance Against the Plan

The Budget Analysis View

Open a validated budget: each line shows Planned, Practical (Actual), Theoretical, and % Achieved side by side.

• Compare Practical vs Theoretical to judge pace — spending 60% of an annual budget by June is on pace; spending 90% by June is a warning sign even though it's still under the full Planned amount.
• Compare Practical vs Planned for the simple over/under total.

On the Profit and Loss Report

Enable Show Budgets on the Profit and Loss report (Financial Reports course) to see Budget and Variance columns laid out against the same account groupings as your actual P&L, rather than switching between two separate screens.

Pivot & Graph Views

Switch to pivot view to compare Planned vs Practical across multiple budgetary positions and analytic accounts at once, or graph view to visualise variance trends across sub-periods.

Best Practices

• Review budget vs actual monthly, not just at year-end — small overspends compound if unnoticed for months.
• Revise a budget mid-year if circumstances genuinely change, rather than leaving an obviously stale plan in place (a budget nobody believes in stops being useful for decision-making).
• Involve whoever is accountable for a budget line in setting it — imposed targets with no buy-in are the most commonly ignored.

Building a Budget

Go to Accounting > Management > Budgets → Create.

Budget Header

• Budget Name – e.g. "FY2026 Operating Budget" or "Q3 Marketing Budget".
• Responsible – who owns this budget.
• Start Date / End Date – the budget's overall period.

Adding Budget Lines

Each line ties a Budgetary Position to a Planned Amount for a specific sub-period:

1. Click Add a line.
2. Select the Budgetary Position.
3. Optionally select an Analytic Account to scope this line to one department, project, or cost center rather than the whole company.
4. Set the line's own Start/End Date (can be the full budget period, or a sub-period like one month, if you want month-by-month granularity).
5. Enter the Planned Amount.

Use several lines with monthly sub-periods (rather than one line for the whole year) if you want the Theoretical Amount comparison to reflect a realistic, non-linear spending pattern (e.g. higher marketing spend in Q4).

Approval Workflow

1. Build the budget in Draft.
2. Click Confirm to submit it for approval.
3. An approver clicks Validate to lock it in as the active budget for tracking.
4. At period end, mark it Done.