Title: Corporate Budgeting in Unanet
Companies may leverage Unanet forecasting features for bottom-up corporate budgeting. Person level and ODC level Budgets (or plans) may be created on direct and indirect projects. Certain individuals (perhaps Managers) are responsible for creating initial yearly budgets. These yearly budgets may be made against individual real projects or against dummy budget-only projects. Once approved outside Unanet, these annual budgets for the upcoming fiscal year can be locked. Then on a periodic basis (monthly or quarterly, for example), authorized individuals have the opportunity to update their anticipated work hours/expenses on projects for the balance of the year. These anticipated hours/expenses are aggregated across the organization to feed into the corporate budget and forecast. The locking process creates an active copy of the initial annual plan which will be the base for quarterly or monthly re-forecasting to get the updated corporate budgets throughout the fiscal year.
What’s covered in this document:
Corporate Budgeting Workflow
For companies with rigorous corporate budgeting requirements, the workflow in Unanet may be similar to that outlined in the diagram and steps below.
Step 1: Admin creates multiple plan sets in Admin > Setup
A Plan Set in Unanet represents a collection of Unanet Plans that can come under a common name. For corporate budgeting, a Plan Set represents a collection of labor and expense Plans that, when viewed together, define a fiscal period budget or forecast. The Unanet Administrator can create Plan Set names at any time to be used by the organization to perform budgeting and forecasting. This section describes the process for configuring new plan sets.
Plan Sets are created in Admin > Setup > Project > Plan Set Names as illustrated below:
The creation of Plan Set Names can be labeled to follow the relevant periods needed for corporate planning and budgeting purposes. Examples of annual and quarterly naming conventions are as follows:
- 2019 Budget
- 2019 Q2 Forecast (April-Dec)
- 2019 Q3 Forecast (July-Dec)
- 2019 Q4 Forecast + 2020 Budget
The Plan Set representing the current budget or forecast should be set as the System Default and Active.
Step 2: Budget Managers (individuals tasked with creating budgets) enter Labor and ODC budgets
Budget managers will be given the appropriate Unanet Role of Resource Planner to plan (you may use the term "budget"). Dashboard links and reports can be pre-saved for all managers. During the budgeting process,the following reports can be anchor reports for reporting on aggregated labor and expense plans (budgets):
- Periodic Cost Summary report
- People Resource Allocation report
- Project Performance or Forecast report
Each manager will only see the projects which they are managing.
Step 3: CFO reviews/approves the collected budget across the organization
Reports such as the periodic Cost Summary (JSR) and Resource Allocation reports may be run by the CFO to approve the budget for all direct and indirect projects in the system and to ensure a balance in resource utilization.
Step 4: Board review and approval
Once the CEO approves, the plans may be presented to the Board for approval.
Step 5: Once Plans are approved, the Unanet Administrator locks the original Plan Set to prevent further editing
At the end of a budgeting or forecasting cycle, possibly once all approvals outside the system are completed, the Unanet Administrator can lock all plans associated with the current Plan Set. This will preserve the contents of the Plan Set and allow comparison to the budget or forecast at a later point in time.
This section describes the sequence of steps to globally or en masse lock a Plan Set:
- Navigate to Forecast > Manage Plan Sets > Lock Plan Sets.
- Locking Plan Sets for all projects freezes the current plans and creates an active copy for re-forecasting.
For more detailed step-by-step information on locking Plan Sets, please visit this link: http://knowledgecenter.unanet.com/x/tTDPAw
Step 6: Re-forecasting
Once the Admin creates the re-forecasting Plan Set, e.g.,"20xx Q2 Forecast (April-Dec)", budget managers would review the actuals for the partial periods via the suite of reports defined above, and revise their projections for the remaining fiscal year.
The process is similar to Step 2 when entering the new planned data.
Step 7: Lock the Re-forecasted Plan Set and move on to the next period
Once the re-forecasting activity is completed, the Unanet Administrator preserves the revision by locking the new plan set, and creating a copy for the next period. The forecasting process is best represented as a sliding window as in the diagram below.
Step 8: Optionally, prepare export templates to extract the labor cost, odc, indirects and revenue into a
csv format for import into a downstream system
If there is a need to send the planned data downstream to an external system such as an accounting system, Unanet provides export templates to extract labor and expense plans/budgets.
The Unanet export formats can also be changed to re-import into the Unanet Financial GL Budgets, thereby allowing review of actuals to budget on the income statement (if using Unanet Financials).
Considerations and other notes
Depending upon the complexity of projects, the following points should be considered when configuring corporate budgeting:
- Unanet has yet to offer the ability to lock fixed price revenue plans. To preserve the fixed price planning data, a special expense type may be used in the expense planner grid along with other expenses.
- The Cost report is modified to exclude this FP revenue type from appearing in the ODC calculation, and includes it as part of FP revenue. Actual FP revenues will be fixed price items in Unanet and FP revenue expense type should be used to only represent the projections.
- You may elect to pre-load users' PTO and holidays.
- It is a suggested best practice to cascade the planning groups. For example, require "contractual works and business plans” managers to perform the first round of planning since they are committed work and then once complete, the next group of budget managers start to fill in the blanks.
- The end goal is to ensure all resources are allocated to 100%.
- A cost report can be customized for corporate budgeting. For example, if the report should be run to include non-fringe indirect projects, the report would not include the G&A calculation, only fringe.
- If your organization uses burdened person cost rates for budgeting purposes, a projected burdened cost rate would be loaded during the budgeting period. The loaded cost rate then needs to revert to the actual rate for payroll reconciliation and actual cost reporting once the budgeting period is over (this is critical for obvious reasons).