Budget extension for a new Fiscal year

Budget extension for a new Fiscal year

Abraxio operating principles

The Department budget is organised by Fiscal year. It contains a set of budget lines grouped by Sub-budget and part of Projects and Activities.

These budget lines have an endless timetable. In other words, the same budget line can carry the budget over several Fiscal years.

For more details, see the article How budgets work in Abraxio .

The purpose of extending a Department budget to a new Fiscal year is to :
  1. Create a new fiscal year
  2. Attach to this new Fiscal year the Projects and Activities that are budgeted in this new Fiscal year.
  3. Automatically extend the "operating" budget lines by extrapolating the trend from the previous Fiscal year to the new Fiscal year.

Initial situation : you have a budget named "DSI" for the Fiscal year 2022 and containing 1 Activity A and 3 Projects A, B, C

Situation after budget extension :

  1. Fiscal year 2023 has been created.

  2. Activity A has been automatically extended . Abraxio has populated the budget line schedule using the 2022 trend.

  3. The 2 projects B and C which are budgeted for 2023 have been attached to the 2023 ISD budget.
  4. Project D, which did not appear in 2022, is attached to the 2023 DSI budget because it covers the budget over 2023.

Once extended, you can finalise the preparation of your budget for the new Fiscal year by adding new activities or projects and adjusting each budget line.

Preparation


Summary of the preparation
  1. Update your current budget before extension: amounts and analytical data.
  2. Check the consistency of the dates of the projects you wish to extend to 2023

Current budget review

As soon as you extend your budget:
  1. Changes made to your active fiscal year will not be carried over to the Fiscal year you are preparing. We therefore suggest that you update your budget to take account of your latest budget updates before extending your Fiscal year. Examples of data to be updated:

    1.  Current budget amounts,
    2. Financial analytical dimensions, Accounting baseline,
    3. Description & Assumptions...

  2. You will be able to delete the budget in preparation (and extend it again to take account of budget changes made in your current Fiscal year) if it does not include a "Committed" budget.

    1. To check this, go to the Purchase orders tab and filter the purchase order end dates > last month of the current Fiscal year. You can then check whether these purchase orders contain budget that has been ordered for future Fiscal years.


RUN or BUILD extension

When extending a fiscal year budget :
  1. For an activity:
    1. All of your RUN or Transverse type lines ( example: Collaborators sub-budget ) will be extended by extrapolating in relation to the latest budgetary trends in the schedule for your current fiscal year:
      1. If the last 2 months are valued: the last month of the fiscal year is copied to each month of the new fiscal year created
      2. If there is a quarterly recurrence: the last quarter of the fiscal year is copied to the 4 quarters of the new fiscal year,
      3. Otherwise, the fiscal year is copied to the new exercise created.
    2. All BUILD type lines will be extended with a budget of 0.
  2. For a project,
    1. If the project dates (defined by the Gantt schedule ) overlap the dates of the new budget year, the lines will all be extended for the following year (even if they do not include a budget) . To modify these dates, it is necessary to update the Gantt schedule from the Portfolio module.
    2. If this is not the case, only the budget lines which contain budget for the period of the next financial year will be extended.
Example of Project Extension: Impacts of project dates during budget extension

Initial situation : You have 2 projects in your portfolio:
  1. Project A: The end date of the project (defined by the Gantt chart) is positioned on year N. 1 budget line has the budget (€ or JxH) planned for year N+1 (line 2 in the illustration ).
  2. Project B: The end date of the project is set for year N+1.
After budget extension :
From the Finance module, on your N+1 financial year:
  1. Project A: Only line 2, with a budget for financial year N+1, was extended within the sub-budget containing it.
  2. Project B: All budget lines, whether or not they have a budget for period N+1, have been extended to your new financial year.



Use the new fiscal year to make full use of Abraxio’s features
  1. Time Follow-up : In order to be able to quantify the time spent by your teams on your projects and activities. Click on this link to access the documentation to initialize time tracking .
  2. Assignments & Capacity Planning : In order to manage your projects and activities from costing to staffing of your collaborators. Click on this link to access the documentation to initialize the workload plan for your teams .

Implementation guide

Rights : The budget extension operation is only possible for users with the cross-functional function: Administer budgets (manager subscription only)

For these different stages, we will name:
  1. Budget N = Current budget at the time you wish to start preparing your budget for the next financial year
  2. Budget N+1 = Budget which will be initialized for the next financial year.

Step 1: Initialising the budget

  1. From the Finance module, in the EXISTING BUDGETS box, click on Extend the budget to a new fiscal year ,
  2. On the budget initialization screen, validate or modify the information automatically included (Budget name, Fiscal period, Responsible) and go to Nex step
  3. Optionally define budget goals (optional fields), then .
Your N+1 budget is then created in the "In preparation" state.

Step 2: Finalising the budget

  1. Create your new budget lines.
  2. Modify your reported lines in order to refine your N+1 budget.
Case study : Recommendations for managing the transition to RUN mode for a project

To integrate budget lines from a Project ending in Fiscal year N into RUN mode for Fiscal year N+1:

  1. Extend your budget. As your project ended during Fiscal year N, only the budget lines with a budget for Fiscal year N+1 will be extended (in the same sub-budget of your project)
  2. Update the information in these lines if necessary
  3. Reintegrate these lines into the most consistent activity sub-budgets (by changing the sub-budget at the budget line level). When registering this operation, you will be able to choose:
    1. Recommended : Create a new budget line. The budget defined for the budget line for financial year N+1 will then be positioned on this new line. You can then delete the old budget line from your fiscal year.

    2. Apply the change to the budget of this budget line to all your Fiscal years.

  4. Once all the lines have been processed in this way, from your N+1 budget, delete the Project sub-budget.


Step 3: Getting Started

Once your budget has been validated, proceed to change the status of your budgets:
  1. Budget N+1: Click on "In preparation"  to change the status to "Active". You will still be able to modify and create your budget lines, but you will also be able to charge consumption.
  2. Budget N: Click on "Active" in order to change the status to "Closed" to signify that the fiscal year has ended. Your budget can no longer be modified and you can finalize the consumption entry.

Remember to create an Initial Statement to save the initial budget for your new fiscal year. As you update your new budget, you will be able to compare the data initially validated in the detailed budget view at any time.

Step 4: Closing the previous budget

When you no longer have anything to add to your N budget :
  1. Update your budget for fisal year N based on consumptions so that it reflects what was actually spent over the financial year (to carry out this operation, please return to the active state in order to modify your budget lines)
  2. Change your budget to Completed status: The budget is no longer editable. Orders and consumption are no longer attributable.
Consider creating a closing budget statement in order to memorize the final budget for your previous financial year.


Appendix : Fiscal year report values

The different Abraxio states are as follows:
  1. In preparation: during the budget preparation phase, you can create/modify budget lines and record orders.
  2. Active: the financial year has started, you can create/modify the budget, record orders and allocate consumption.
  3. Closing: the financial year has ended, your budget can no longer be modified and you can no longer register an order. You can finalize the consumption entry .
  4. Finished : your budget and consumption can no longer be modified.

Until you receive the last invoice for Fiscal year N, we recommend that you leave this budget in the "Closing" status so that you can enter the Consumption, until you have used up the balance of the Purchase orders included in this Fiscal year --> You should therefore plan ahead for all the budgets before closing (or leave the 2 Fiscal years in the Active status, but anything modified in Fiscal year N will not be taken into account for Fiscal year N+1).

As far as the analytical dimensions are concerned, they are included at the time of the extension. However, if you have extended Fiscal year N to N+1 and then change the value of an axis in N, this change will not be automatically carried over to N+1.



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