Budget Based on an Existing Budget: Process Activity

The following activity will walk you through the processes of preparing a budget based on an existing budget and comparing the new and existing budgets.

Story

Suppose that the financial supervisor of SweetLife Fruits & Jams has to prepare an optimistic budget for 2025 based on the uploaded budget for 2024. The articles of the budget should be increased by 15%, except for the rent or lease expense, which should remain the same. (Wages belong to the part of the budget that will be increased by 15%.)

Acting as the SweetLife financial supervisor, you need to update the budget in the system.

Configuration Overview

In the U100 dataset, the following tasks have been performed for the purposes of this activity:

  • On the Companies (CS101500) form, the SWEETLIFE company has been defined.
  • On the Branches (CS102000) form, the HEADOFFICE branch of the SWEETLIFE company has been created.
  • On the Chart of Accounts form, the 62900 (Rent or Lease Expense) account has been created.
  • On the Ledgers (GL201500) form, the BUDGET ledger has been added.

Process Overview

In this activity, you will first create a new financial year, 2025, on the Master Financial Calendar (GL201000) form. On the Budgets (GL302010) form, you will prepare a budget for 2025 based on the budget for 2024 and release it on the Release Budgets (GL505510) form. Finally, on the Budgets form, you will compare the budget for 2024 to the budget for 2025.

System Preparation

Before you begin creating budgets for 2025, do the following:

  1. Launch the MYOB Acumatica website with the U100 dataset preloaded, and sign in as an accountant Anna Johnson by using the johnson username and the 123 password.
  2. On the Company and Branch Selection menu on the top pane of the Acumatica ERP screen, make sure that the SweetLife Head Office and Wholesale Center branch is selected. If it is not selected, click the Company and Branch Selection menu to view the list of branches that you have access to, and then click SweetLife Head Office and Wholesale Center.
  3. Make sure that you have performed the following prerequisite activity to create the BUDGETOPT ledger: Budget Ledger: Implementation Activity.
  4. Make sure that you have performed the following prerequisite activity to upload and release a simple budget for the HEADOFFICE branch:Simple Budget: Process Activity.
  5. Make sure that no budget tree has been configured on the Budget Configuration (GL205000) form. You cannot complete this activity if a budget tree has been configured.

Step 1: Creating the 2025 Financial Year

To prepare the system for the creation of the 2025 budget, do the following:

  1. Open the Master Financial Calendar (GL201000) form.
  2. On the form toolbar, click Generate Calendar.
  3. In the Generate GL Calendar dialog box, which opens, make sure that 2025 is selected in the From Year and To Year boxes, and click OK.

Step 2: Preparing and Releasing the Sales and Production Budgets for 2025

To prepare an optimistic budget for 2025 based on the budget data of 2024, do the following:

  1. Open the Budgets (GL302010) form.
  2. In the Summary area, specify the following settings:
    • Branch: HEADOFFICE
    • Ledger: BUDGETOPT
    • Financial Year: 2025
  3. On the form toolbar, click Preload Articles.
  4. In Step 1 of the Preload Budget Articles wizard, which opens, specify the following settings:
    • Branch: HEADOFFICE
    • Ledger: BUDGET
    • Financial Year: 2024
    • Multiplier (in %): 115
  5. Click Next.
  6. In Step 2 of the wizard, leave the selection of all account–subaccount pairs, and click Next.
  7. In Step 3 of the wizard, leave the Update Existing Articles and Load Nonexistent Articles option button selected, and click Finish.

    The system calculates the sales budget for 2025 as a 15% increase over the budget figures for 2024 kept for the HEADOFFICE branch in the BUDGET ledger.

  8. In the row with the 62900 (Rent or Lease Expense) account, enter 14,400.00 in the Amount column.

    This is the original amount of the rent expenses from the 2024 production budget, which should stay the same for 2025.

  9. On the table toolbar, click Distribute.
  10. In the Distribute Year Amount by Periods dialog box, which opens, leave Evenly in the Distribution Method box, and click OK.
  11. On the form toolbar, click Save to save your changes.
  12. Open the Release Budgets (GL505510) form.
  13. On the form toolbar, click Release All.

    The Processing dialog box opens; close this dialog box when the processing has completed.

Step 3: Comparing the 2024 and 2025 Budgets

To compare the budgets for 2024 and 2025, do the following:

  1. Open the Budgets (GL302010) form.
  2. In the Summary area, specify the following settings:
    • Branch: HEADOFFICE
    • Ledger: BUDGETOPT
    • Financial Year: 2025
    • Compare to Branch: HEADOFFICE
    • Compare to Ledger: BUDGET
    • Compare to Year: 2024
  3. Review the results in the table on the form.

    As you can see, all the budget articles have been increased by 15% for 2025 except for the Rent or Lease Expense article, which stayed the same in 2025 as it was in 2024.