Public Sector Planning and Budgeting supports these budgeting approaches:
Bottom-up budgeting, in which expenses from low-level entities (cost centers, departments, business units, and so on) aggregate upward.
Distributing or top-down budgeting, in which expenses are disseminated from the highest level entity downward. In this budget implementation, initial budgets are prepared by the top level owners of the entity hierarchy, who pass the control to update and view budgets to lower level entity owners such as cost center or business unit managers. These lower level entity owners update compensation expenses, and then submit budgets back to the top level owners.
Target budgeting. Although this approach prevents you from using Approvals, it enables you to identify, enforce, and track the budget allocated to all offices, bureaus, cost centers, and business units by defining target versions. For example, a Public Sector organization may receive $800,000 from the federal or country government. Using target budgeting, the organization allocates funds to different departments, preventing them from submitting budget requests that exceed their departmental limits.