Budgeting based on history

The new budget is based on actual entered amounts (realisations).

Although Profit always budgets on the basis of an annual budget, you can also take another period as the starting point, such as a period of two years or six months. Profit determines the new annual budget by converting the realisation to an annual amount and then, if required, increasing it by a percentage you specify. Profit then determines the period budgets using the periodic allocation table of the ledger account.

Note:

Link another periodic allocation table to the ledger account if you do not want to allocate the budget for this ledger account using the proportionate periodic allocation table.

Example:

You budget the ledger account Brutolonen for the current financial year.

• The new budget is based on the history from period 1 of the previous financial year to period 12 of the previous financial year. The realisation for these years was 2,400,000.00.
• The budget must be increased by 5%.

  Profit determines the new budget as follows:

• 2,400,000.00 / 24 = 100,000.00 per month
• Annual amount: 12 X 100,000.00 = € 1,200,000.00
• Annual budget (= annual budget + 5% increase): 1,200,000.00 * 105% = 1,260,000.00

  Profit distributes the new annual budget (€ 1,260,000.00) over the months of the current financial year based on the periodic allocation table.

If you allocate a specific ledger account, Profit budgets the allocations. In this case, the starting point is the realisation per allocation/general ledger account.

To budget based on realised history:

1. Go to: Financial / Ledger / Budget.
2. Click on the action: Generate budget.
3. Select a range of general ledger accounts by entering the lowest and highest value for the range. You can adjust the selection later.

   If one or more accounts within the ledger selection do not have a budget from which budget data can be provided for a new budget, a message is displayed. A message also appears if one or more of the accounts for which you want to create a budget already has a budget. In these cases, you must change your account selection. You could, for instance, generate using smaller selections.

4. Select the allocation axis if you want to budget allocation codes.
5. Enter the year to be budgeted.
6. Enter the percentage by which the budget must be increased. If you want to decrease the budget, enter a negative percentage.
7. Specify how you want to round the new budget.
8. In Budget is based on, select History.
9. Click on: Next.
10. Specify the period whose realisation Profit must use. Profit converts the realisation into an annual amount and multiplies this outcome by the percentage of increase or decrease.
11. Click on: Next.

    Profit displays all ledger accounts that fall within the range and that can be budgeted. In the 'Basic budget'column, you see the calculated annual amount based on the realisation for the years and periods you have selected. The Budget amount is the annual budget after the percentage increase or decrease has been applied.

12. Select the check boxes of the accounts to be budgeted.
13. Click on: Finish.