Using Project Budgetary Control in Procure-to-Pay Applications

Julian Kozicki Great Projects

Using Project Budgetary Control in Procure-to-Pay Applications

Projects Mini-Pack H Overview Budgetary Control Online Funds Checking Budget Account Generation Bottom Up Budgeting - Setup and Initiation Top Down Budgeting Setup and Initiation Summary Questions and Answers

Projects Mini-Pack H Overview

Oracle Projects Mini-Pack H released December 2001 Documentation supplement only available in Metalink (current version March 2002) Features include:
Budgetary Controls within Procure-to-Pay cycle for project level budgets Budget Integration with Oracle General Ledger Bottom-up or Top Down Budgeting

Projects Mini-Pack H Overview (Continued)

Bottom-Up Budgeting
Allows the creation of centralized organization-level budgets from defined project budgets and non-project budgets. Project budgets are interfaced to Oracle General Ledger by creating budget journals.

Top Down Budgeting

An overall organization-level budget, that defines overall spending limitations, allows centralized control over organization spending. Project budgets consume funds from the organization-level budget, which is maintained in Oracle General Ledger.

Budgetary Controls
Allows the organization to monitor and control expense commitment transactions entered against a project by checking available funds
Project-related purchase requisitions and purchase orders entered in Oracle PO Supplier invoices entered in Oracle Payables Expenditure adjustments in Oracle Projects

Significant additional capabilities than available from Transaction Control Client Extension Exceptions include expense reports, time sheets, inventory purchases, and usage costs.

Internal System Flows Budgetary Control for Bottom-Up Budgeting

Standard Budget
Funds Check Funds Check Budget Journals

Purchasing

Payables

General Ledger
Funds Check

Invoice Costs Committed Project Costs Budget Transactions

Project Costing/ Project Billing

Budgetary Control Balances

Internal System Flows Budgetary Control for Top-Down Budgeting

Encumbrances
Funds Check Funds Check & Encumbrances

Funding Budget

Encumbrance Journals

Purchasing

Payables
Funds Check & Encumbrances Invoice Costs

General Ledger

Committed Project Costs

Encumbrance Transactions

Project Costing/ Project Billing

Budgetary Control Balances

Budgetary Controls
Prerequisites
Must enable budgetary controls in Oracle General Ledger Must enable encumbrance accounting in General Ledger and Oracle Payables (for TopDown Budgeting only) Must apply General Ledger patches 1995914 and 2002508

Online Funds Checking

Procedure called by workflow at several points within Oracle Purchasing, Oracle Payables, and Oracle Projects applications (check funds option and transactional approval) where if the funds check fails, the transaction is not approved. Can customize work flow based upon business rules to trigger actions by project managers, project approvers, and others so that budgets can be increased or budget funds checking time intervals and control levels can be changed

Transaction Funds Check Window Results

Budget Funds Check Results Window

Online Funds Checking (Continued)

Based upon Time Intervals and Control Levels and GL date of the transaction
Time Interval can be period-to-date, year-to-date, or project-to-date for a period, year, or project Control Level can be Absolute, Advisory, or None Can be set by Resource, Resource, Group, Lowest Task, Top Task or Project (can also be rolled up)

Set by Project Type, but can be overridden in Templates and Projects, if desired.

Project Types Window Budget Integration Options

Project Budget Account Generation

Each project budget line must have an account number assigned to integrate with General Ledger A new Project Budget Account Workflow is provided to perform this task
Must be customized generates a dummy account when first installed Uses can use constants, parameters, or SQL in the same way as the Purchasing and Payables Account Generator

Project Budget Account Workflow is activated two ways:

Manually, by selecting the Generate Budget Accounting option from the Tools menu of the Budgets window Automatically, when an integrated budget is submitted for baselining

Option may be set to manually override the budget account assigned in Project Budget Account Workflow

Budget Account Details Window: by Budget Line Tab

Navigate: Budgets>Tools menu>select Review Budget Accounting option

Budget Account Details Window: by Account Tab

Navigate: Budgets>Tools menu>select Review Budget Accounting option

Bottom-Up Budget Integration Initiation Procedures

Define the organization-level budgets in Oracle General Ledger Define Budget Integration for the projects Enter project budget amounts and generate accounts for each project budget line Baseline project budgets and interface the budget amounts to General Ledger Create budget journal entries from the interfaced amounts in General Ledger Review and post the budget journal entries

Bottom-Up Budget Integration Implementation Steps

Define Project Budget Account workflow account generation process Set profile option: PA: Allow Override of Budget Accounts (Y or N) Set profile option: PA: Enable Budget Integration and Budgetary Control Feature (Y) Define Integration for Project Types, Templates, and Projects

Top-Down Budget Integration Initiation Procedures

Define General Ledger Funding Budgets Define Budget Integration Create Project Encumbrances
Create Project Budget and generate accounts for each line Baseline Project Budget and create encumbrance lines for import to General Ledger Create and post encumbrance journals in General Ledger

Liquidating Project Encumbrances Year-End Budget Rollover

Top-Down Budget Integration Implementation Steps

Define Project Budget Account workflow process Set profile option - PA: Allow Override of Budget Accounts (Y or N) Set profile option - PA Enable Budget Integration and Budgetary Control Feature (Y) Set profile option - PA: Days to Maintain BC Packets (default = 3) Define integration details for project types, templates, and projects

Summary
Closes the budgetary control loop for project and nonproject organization level budgets Provides automated funds checking to prevent approval of requisitions, purchase orders, or invoices that exceed defined project budget limits Can customize workflow to provide notifications and other actions where budget amounts are exceeded Provides a central repository of project and non-project budgets in Oracle General Ledger Easy setup, but requires additional projects user training on new budget integration procedures and additional training for General Ledger, Payables, and Purchasing users for funds checking business rules.

Locking Down Project Level Budgets Throughout the Entire Procure-To-Pay Cycle

= High ROI Potential

Q U E S T I O N S A N S W E R S

About Great Projects

Management Consultants specializing in Oracle Projects Suite applications and related technology:
Oracle Projects Costing Oracle Projects Billing Project Manufacturing iTime and iExpense Project Resource Management Project Contracts Integration through Activity Management Gateway (including MS Project Connect) Grants Accounting Project Collaboration Custom Reporting and on-line dashboards using Oracle BIS, Discoverer, Project Kiosk, or using 9iAS Portal technology Project Intelligence Integration to/from legacy systems

Contact Information:
Julian Kozicki Managing Director Great Projects Atlanta GA E-mail: jpkozicki@gr8projects.com Phone: 770-739-6810