Budget planning setup in Microsoft Dynamics 365 Finance and Operations

Budget planning setup in Microsoft Dynamics 365 Finance and Operations

Budget planning in Microsoft Dynamics 365 Finance and Operations One version - part I

This blog is part of series to cover key setup and configuration to leverage budget planning in Microsoft Dynamics 365 Finance and Operations one version (D365FO)

Let us start with list of business scenarios enabled with this feature:

• Planning approach
• Top down
• Bottom up
  • Collaboration
  • Single source of truth
  • Accurate financial reporting insights

Best suited for financial level budgeting right from planning to reporting and control.

We start with selecting the dimensions which can be used in budgeting area

 Let us now take a deep dive into select setups and configuration on budget planning in D365FO:

• Budget planning process
• Budget cycle time
• Organization hierarchy with Budget planning purpose code
• Security model for budget planning to access budget plans
• Employee and user setup
• Employee position to allow access to that department budget plan or user access to security organization hierarchy
• Security roles
• Budgeting dimension
• Budget planning configuration
• Scenarios
• Stages
• Workflow
• Allocation schedules
• Stage allocation
• Columns
• Layout
• Budget plan review workflow

Budget planning process is the binding element which keeps the collaborative effort together.

Once needs to activate a budget planning process before using it.

The planning process covers the legal entity, budget cycle (time horizon), account structure, organization hierarchy, workflow association with operating units and rules and layout options per workflow.

An option to define alternative layouts is also possible.

The budget cycle time is key in giving the time window of planning process and could mapped to a fiscal year or could be user defined for long range planning.

The organization hierarchy to leverage in budget planning needs to have purpose as 'Budget planning'

While defining budget planning process is the ultimate goal, it depends heavily on budget planning configuration.

In budget planning configuration we define all moving parts needed for planning and select decision to configure it's usage.

Budget planning has an extra level of security which ensures only those authorized to view information would be able to get it.

This is implemented by two layer security. One is the security model to gain access by position or by security organization.

Other security layer is by using security roles.

There are three security roles for budget planning which could be selectively assigned to users based on business needs, These roles are:

• Budget clerk - This role is of 'Activity' type
• Budget contributor - This role is of 'Team' type
• Budget manager - This role is of 'Operations' type

When using positions as security layer in budget planning, the employee linked to the user must have a position in the department to be able to access the budget plan and work on them.

Below are positions in finance and Sales & marketing department assigned to a user to facilitate budget planning activity.

Next in budget planning, we define various elements to hold information and it's movement.

Budget scenarios are defined to hold typically monetary information in various buckets.

Next we define unique stages to be used in one or many budget planning workflows.

The combination of stage, scenario, layout and rules are important to drive a successful budget planning process.

In workflow stages we suggest which workflow would use which all stages and some constraint around it.

Next we define allocation rules to move various information holding scenarios across plans.

Most commonly used allocation techniques used are:

• Distribution - Used in top down approach to pass information from parent plans to child plans
• Aggregation - Used in bottom up approach to pass information from to child plans to parent plan
• Period allocation - To spread information using a key
• Allocation rule - Uses Budget allocation rule

These allocation rules are combined with stages to trigger execution from budget plan workflow.

One can as many stage allocations to trigger however the stage must match the timing of the workflow.

Next we define how to segment the scenario information in various time buckets and present it using columns and layouts.

In Column we specify which scenario is represented with the time period factor.

In layout definition, we define which all columns are to be shown.

These layout help in dynamically painting the user experience to show columns.

One can also show description for any of the ledger account segment.

Note the option which makes this column available in Excel.

The workflow stage definition uses budget plan review type workflow and one needs to author these workflow mechanics to ensure smooth flow of information at each participating operating unit in budget planning process.

The top level workflow is typically the orchestrator which binds the budget plans together and also suggest when the stage allocations gets triggered.