Budgets

Grouping Accounts for Budgeting

Go to Accounting > Configuration > Budgetary Positions. Before creating any budget, decide how you want to group your chart of accounts for planning purposes — this is a one-time setup that every future budget reuses.

Creating a Position

1. Click Create.
2. Name – e.g. "Marketing Expenses", "Salaries", "Product Revenue".
3. Accounts – select every GL account that should count toward this position. A position typically maps to one or more expense/income accounts, not a single account, so a budget line can track a whole category at once.

Design Tips

• Keep positions aligned with how your P&L is already grouped (Cost of Revenue, Operating Expenses categories) so budget variance reads naturally against the P&L.
• Don't let positions overlap (the same account in two positions) — it double-counts that account's actuals across both budget lines.
• Create separate revenue and expense positions rather than one broad "everything" position, so favourable/unfavourable variance stays meaningful.

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.