Summary Level Budgetary Control (Oracle General Ledger Users' Guide)


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Summary Level Budgetary Control

Use summary budgetary control for less detailed control over expenses. For example, you might want to control expenses at a department or cost center level, or by category of expense rather than individual expense items. You might also want to check funds at different levels within a cost center and disallow a transaction only if a cost center budget does not have available funds.

The major advantage of summary budgetary control is that you need not budget to each detailed account you use for budgetary control. For example, you can control expenses by checking available funds for all expenses of all types within a department. As long as a budget amount is available for at least one account that you summarize to the department level budget, you can check available funds and reserve them.

Another advantage of summary budgetary control is that when you create an account, you can check funds on it and reserve funds for it without budgeting to the detail account, once summary relationships are properly defined.

To perform summary level budgetary control, you must define rollup groups before you can assign them to segment values. For example, if you have three departments (Acquisition, Planning, and Maintenance) within a division (Facilities), and you perform budgetary control at the division level, you define a rollup group. The rollup group is used to summarize budget, actual, and encumbrance amounts for each department and to roll up these amounts to create a division amount.

After you define rollup groups, you must define summary accounts and assign budgetary control options for each summary template. You must define summary accounts to perform funds checking at a summary level or at both summary and detail levels.

Example

You budget $10,000 for all equipment expenses for the department to account Company01-Any Equipment-Dept01. You define a rollup group that includes other equipment expenses and the Any Equipment account segment value, and you create a summary template that summarizes equipment expenses by department. Now when you enter a purchase order which you charge to Company01-Other Equipment-Dept01, the system automatically checks funds against the budget amount you entered for Company01-Any Equipment-Dept01 and any other accounts which belong in the summary level department budget.

Since you can enter budgetary control options for summary templates and detail accounts, define these options carefully. While the system prevents you from defining options for overlapping ranges of detail accounts, the system does not prevent you from defining options that might result in budgetary control at a lower level than you intended. For example, if you define Absolute budgetary control at the department level and Advisory budgetary control for the company, then any transaction for which the department has insufficient funds fails funds checking and funds reservation, even if the company has available funds for the transaction.

Suggestion: Specify Absolute budgetary control for the summary template or templates that have the highest level of summarization. If you define multiple summary templates that include an account, any transaction using that account must pass budgetary control checks at all levels. Usually, you disallow only transactions that fail at the highest level of summarization.

Summary Level Budgetary Control

See Also