Budget structure example

In Visma.net ERP, you can create a budget structure with multiple levels of budget articles.
For more information on budgets, see: Overview of budgets

Consider a simplified example of a budget structure for a company called Winter fun.
This business has two stores (one store on the west slope of a mountain and another on the east slope), sells skis and snowboards, and offers rental services.
The company's stores are too small to function as branches, so the Branch accounting functionality is disabled in the company's system.

The organisational structure of the company is reflected in the subaccounts.
In Visma.net ERP, if the Subaccounts functionality is enabled, subaccounts are used with accounts to virtually split accounts into more specific accounts for detailed tracking and reporting.

In our example, the subaccounts have the following structure:

• First segment: Company store (point of sale)
  • WS (west slope store)
  • ES (east slope store)
  • 00 (non-specific to a store)
• Second segment: Profit centre
  • RENT (rentals)
  • SALE (sales)
  • 0000 (non-specific to a profit centre)
• Third segment: Product type
  • SK (skis)
  • SB (snowboards)
  • 00 (non-specific)

In our simplified example, the Winter fun company prepares the budgets with the following major budget articles:

• Revenue from sales
• Revenue from rentals
• COGS
• Other expenses

In Visma.net ERP, you use the Budget configuration (GL205000) window to build a budget tree for the company.
On the budget tree, the major budget articles are the nodes of the first level (just under the root node).
No account and subaccount masks are specified for these nodes because these nodes include only nodes, not leaf articles. Masks are used for generating leaf articles or for aggregating the data for leaf articles for a particular budget.

On the left pane of this window, the tree-like budget structure for the company would be organised as schematically shown in the table below.

In the Budget configuration (GL205000) window, each budget article shown in the table above with an account mask (or just an account) in the Account mask column and a subaccount mask in the Subaccount mask column is a node. Each budget article with an account specified in the Account column and a subaccount specified in the Subaccount column is a leaf article on the budget tree. Budget articles included in other budget articles (nodes) are also referred to as subarticles.
Once you specify the amounts for all leaf articles, the system will calculate the sums of subarticle amounts for each node article.

The articles with values in all four columns are leaf articles with initial aggregation over the data defined by these masks.
The expenses recorded to the Repairs and maintenance account for each store last year, although summed up to significant amounts, cannot help in predicting the expenses for the budget year, but the their sum can. The company can plan the amounts based on the previous year's data with a specific coefficient whose value is based on the percentage of old equipment and other related factors. The company plans these amounts as lump sums without details.
To do this, the company uses the budget articles with aggregation.
The articles have the account-subaccount pairs specified and the subaccount masks for aggregating the amounts.

Parent topic:
Manage budgets - overview

Related concepts
Overview of budgets

Related reference
Budget (GL302010)