Budget envelopes

Off budget envelopes

In budget envelope creation, it is possible to indicate that this envelope must be created without amount. This option is carried out by ticking box "Off budget" in the entry screen. It is used to commit expenses on envelopes, budgets and budget lines whose planned amount is unknown upon budget completion, or that are not to be indicated. The management and evolution of these envelope types follow the process described below:  

• Ticking field "Off budget" in the envelope entry screen authorizes the creation of the envelope, its budgets and budget lines with no amount. The amount entry is prohibited.
• The envelopes, budgets and lines which are "Off budget" (or only budget lines if the approval of lines has been disconnected from their budgets and envelopes approval: user parameter GDDDEPAPP to Yes) must be approved in order to enter purchase expenses (purchase request, orders, invoices). This approval results in fixing the approved envelope, budget and null line amount (or only the null lines).
• The purchase request, order and invoice entry triggers the application of a negative balance to the lines, budget and envelope. The overrun controls implemented in the operating budget management are not applied.
• When the envelope, budget and line amounts are known, they can be loaded via revisions. In order to carry out a revision, the envelop and the budget must have been approved previously if only the budget lines have been approved. After revision, a reserve can be created on these envelopes.
• A utility that can be accessed via menu "Off budget cancellation" is used to perform the cancellation of status "Off budget" when revisions have been carried out.
• If this indicator is kept, no overrun control is carried out in order or purchase request entry.
• If this indicator is canceled, budgets, envelopes and budget lines follow the management rules implemented in the application on overruns.

Project and envelope definition levels

A project can be defined for a site, a company or be transverse, i.e. defined for a group of companies or sites.

A budget envelope is linked to a budget code. This budget code define if the tracking level is the site or the company. Depending on this rule, the envelope is attached either to a company or a site.

The project, budget and budget line definition level follows the following management rules:

• If a project is attached to a site, the linked envelopes are attached to the same site,
• If a project is attached to a company, the linked envelopes are attached to the same company,
• If a project is attached to a group of companies, the linked envelopes are attached to one of the companies belonging to this group or to a site of one of the companies from this group, depending on the budget code characteristics,
• If a project is attached to a group of sites, the envelopes are necessarily attached to one of the sites from this group.  The budget code must be consistent.

For a budget code defined at company level, the definition possibilities are the following:

For a budget code defined at site level, the definition possibilities are the following:

 The groups are dynamic and can be modified. The user has to check that their modifications are consistent.

Envelope, budget and budget line approval

The approval process contains two functions:

Approval request submission:

• From the object concerned: envelope (menu bar), budget by fiscal year or budget line 
• From a submit screen used for a multiple approval request: budget lines, budgets and envelopes or Budgets and envelopes, depending on the user choice, their rights and the general parameters determining the objects to be approved.

Approval validation or refusal:

• Validation or refusal of the approval via the electronic messaging, in response to a received message, by clicking on the corresponding link or by access to the function by selecting the linked file,
• Via a submission screen used to validate or refuse the request for all objects of a multiple request or for a single object.

Approved amount

The review status is set to Approved after the last signature has been obtained. When a review request is approved, the Approved amount on all linked records is not updated. This amount is frozen with the value of the first approved amount for traceability purposes. To see how the Approved amount has changed, run the Review inquiry function.

If one of the circuit signers denies the review, its status is set to Rejected.

During the entire approval cycle, you cannot modify the envelope, budget, budget lines, and review request. This control ends as soon as the review is approved or rejected.

You can only cancel a review after approval with a reverse review.

When approving a single object, the approved amount of this object can be modified, in the limit of the controls applied. For example: The envelope amount cannot be lower than the total of its budgets.The budget amount cannot exceed the envelope amount and must be lower that the total of its budget lines, etc.

Only budget objects having amounts can be submitted to approval and approved, except for those with type Off budget that can be submitted to approval and approved with an amount that equals zero.

The envelope, budget, and budget line approval management is subject to three company parameters used to define controls (Yes/No) to be performed on each budget level. There is no specific consistency control between the various values.

These parameters (GDD chapter, GDD group) are used to specify whether: 

• An approval must be processed at Budget envelope level: GDDAPPENV - Envelope approval
• An approval must be processed at Budget by fiscal year level: GDDAPPBUD - Approval fiscal year budget
• An approval must be processed at Budget line level: GDDAPPLIG - Budget line approval

The various possible combinations are the following:

The combination No + No + No is prohibited by a control applied to the general parameters entry.

If a level is set to No, its Status field will be assigned the status of the superior entity upon creation and will follow this status upon updates.

Thus, if a budget line subject to the evolution of its budget is created after budget submission, this line is created with status Approved; if it is created after approval of its budget, it is created with status Approved. The approval refusal of an object submitted to approval leads to setting the objects linked to its evolution back to status Entered. In the previous example, if the budget is subject to an approval refusal, all its lines take status "entered".

These various approval levels are processed sequentially and based on distinct approval patterns that can be set up:

• Cascade approval : The approval request for a Budget by fiscal year is triggered only if the budget belongs to an approved "Budget envelope" or if no approval is managed at "Budget envelope" level. Also, the approval request for a "Budget line" is triggered only if the line belongs to an approved "Budget by fiscal year" or if there is no approval managed at "Budget by fiscal year" level.
• Multiple approval: You can perform joined approval requests for a line, a budget and an envelope by performing the selection via the lowest level. In case of a configuration requiring the approval of envelopes, budgets and budget lines (Yes + Yes + Yes), choosing a budget line automatically selects the budget and the envelope. If the budget line approval is not desired, the selection is carried out from the budget, which automatically selects the corresponding envelope. The budget lines approval request can only be carried out once their budgets are approved. Selecting the budget line only is not possible if its budget and envelope are not approved.
• Budget line disconnection: These cascade rules can be deleted at user level (general parameter) to allow the approval of a budget line in advance and authorize the posting of purchases on this line without provoking the approval of the corresponding budgets and envelopes. 
• Access restricted by user: Within the framework of the above-mentioned rules, the user parameters USRAPPENV, USRAPPBUD and USRAPPLIG are used to restrict the approval for a given user to envelopes only, budgets only, lines only or to a combination of these objects (envelopes and budgets, or budgets and lines)
  
  These restrictions do not change the approval management rules, and a user who has the authorization for the budget line approval will see these budget lines if the approval parameters plan the direct approval and when budgets and envelopes are directly or indirectly approved. This also applies to a restriction in the approval of budgets, which are displayed if their approval is direct and after envelope approval.

The implementation of an approval management implies the following operation:

• Status set to Entered on an envelope, budget and line record
• Launch of a workflow via button Approval request at the level of each object and/or "Global approval request" function. The status is set to Approve.
• Response to this workflow by the signatory/signatories (based on the signature circuits in use). The status is set to Approved or to Entered in case of refusal. This approval or refusal applies to the object concerned, but also to the objects of lower level which do not contain any approval management.

Budget overrun management

The application contains a budget overrun management which can be set up based on the company management rules. The budget overrun management is used to authorize the budget overrun in purchasing based on criteria that can be set up for envelopes with a type other than "Off budget".

• If no overrun is authorized, the entry of a purchase or order request is blocked as soon as the budget line balance is insufficient.
• If no control is implemented, overruns are authorized and the available budget line balance may become negative; the manager will have to carry out the necessary budget adjustments (revisions).
• If overruns are authorized, they are subject to the criteria implemented and the budget line balance becomes negative, too; the manager has to carry out the necessary adjustments (revisions). If the entered amount overruns the authorized overrun amount, the entry for the purchase or order request is blocked.
• The invoice entry is not subject to the purchase overrun rules. Any entered invoice is authorized whatever its amount; if necessary, credit memo requests will have to be carried out.

Some BUD general parameters are common to operating and analytical budgets.These parameters must contain the following values for the controls on operating budgets to be carried out:

 The following ACH general parameters relating to the commitment and pre-commitment generation must also be activated: 

GDDBUDDEP parameter:  This parameter allows the following choices: 

Envelope amount overrun %: Parameter GDDBUDPRC is used to enter an authorized overrun percentage for the envelope amount. It is relevant only if the potential overrun parameter is "Envelope amount overrun". This percentage is calculated based on the amount of the budget line, budget by fiscal year or budget envelope defined in parameter GDDBUDCTL. The envelope contains an overrun % field used to apply an overrun % different from that of the general parameters, which is applied in priority when entered.

Budget control level: Parameter GDDBUDCTL means that in case of authorized envelope amount overrun, the authorized overrun amount will be calculated based on the entered percentage applied to the line, budget or envelope amount, depending on the selection carried out: Line, Fiscal year or Envelope

Budgetary and accounting postings

So as to satisfy every company legal context, posted amounts in expense accounts must correspond -depending on cases- to:

• the ex-tax amount: regular functioning mode of most companies,
• the ex-tax amount with re-incorporation of the non recoverable VTA amount: banks, insurance companies,
• to the ex-tax amount with re-incorporation of the totality of the VTA amount: administrations, training, health...

The application is used for the posting of expenses and the generation of pre-commitments, commitments and expenses according to one of theses three options. Corresponding budgetary postings are done according to the same rules.

This commitment mode is determined by the PURCMMTAX - Commitment type parameter (ACH chapter, CMM group). The posting of invoices and credit notes and their budget upload depends on the VAT rate and on the deduction percentage.

The supplier code contains the tax rule. Purchase requests can be entered without supplier code: therefore, the PURVACBPR- Default tax rule parameter (ACH chapter, CMM group) can be used to stock a default tax rule for the entry of purchase requests, for the company or the site.

Deletion of envelopes and budgets

It is not possible to delete an envelope including budget lines, it is necessary to delete the budget lines first, if their situation allows it.

An approved budget line cannot be deleted, it is not possible to cancel the approval of a budget line including expenses (pre-commitments, commitments or completed).

An envelope that does not include a budget line can be deleted, with the following updates:

• if the envelope has been renewed or deferred, the link and the information contained in the envelope created are deleted.
• If the envelope originates from a renewal or a deferment, the renewal information is deleted from the original envelope.

Prerequisite

Refer to documentation Implementation

Screen management

The envelope recording and modification function contains three tabs:

• an "Envelope" tab to enter the envelope and budget by fiscal year information,
• A "Miscellaneous" tab to enter the fixed asset information,
• An "Office" tab used to enter or import all the relevant information for the envelope description in the shape of WORD, EXCEL or POWERPOINT documents.

Header

Tab Envelope