Definition of Budget Hierarchy 

Purpose

This process describes how you can define and edit a budget hierarchy for an overall budget that you want to set up in HR Funds and Position Management.

The budget hierarchy is used to define the budget structure elements and to show how they are linked hierarchically. Defining a budget hierarchy is the first step in setting up an overall budget.

Budgets (either monetary or FTE) are assigned to the budget structure elements in the budget hierarchy. These budgets can then be used to finance persons and positions.

In other words, the budget of a budget structure element contains the funding that is used to finance persons and positions in an overall budget.

In this process, you define the fundamental structure of the overall budget. This process does not, however, involve assigning budgets to budget structure elements.

Prerequisites

You must have made the necessary settings in the Overall Budget section of Customizing (and, in particular, the section Defining Budget Structure Element Types. You can then tailor the budget hierarchy to your organization’s individual needs.

Process Flow

  1. First, you specify basic information for a new overall budget (the financial year, and the top budget structure element).
  2. You create more lower-level budget structure elements under this top budget structure element (root budget structure element), and in this way define a hierarchical structure for the overall budget.

Example of a Budget Hierarchy

The following budget hierarchy is used in the examples found in this documentation.
  1. If required, you can specify additional information on the budget structure elements (e.g. who is responsible for a budget, the external budget number/name and a plain text description).
  2. You can also assign the budget structure elements and their budgets to employee groups and subgroups, or to organizational units and positions (via earmarkings).

Result

You have created a budget hierarchy containing budget structure elements to which you can now assign budgets.

If an overall budget already exists, you can follow the Carrying Forward of Overall Budget process to carry the budget hierarchy forward to the next financial year. This means that you do not have to re-enter budget structure elements that already exist.

It is possible to add new budget structure elements to an overall budget that has already been executed (e.g. because the government has approved additional budget funds).

 

 

See also:

Defining a Budget Hierarchy

Editing a Budget Hierarchy

Budget Structure Element