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Hi,
I am investigating to see how we can use the forecasts in project module Vs. Budget and I have a few questions. Is there a relationship between forecasts and budget? In other words is it possible to have forecasts (which captures more information than just a dollar amount) and turn it to a budget? Will the budget and forecasts be in sync even after changing the forecast? or even after doing transactions.
Another question is how is it related to unit price agreements?
Thanks,
Reza
Hi
I totally agree with ludwig.
But there is one point which made us to use both forecast and budget.
If you enter the budget at item level and want to control that, the control will be at item level too.
But in some scenarios, you need to track the item details, but not controlling at item level.
Forexample we enter the forecast at item level and whole project budget in budget. In that way, if we purchase an item in a higher amount of the forecast, nothing happen untill we are in range of the project budget. But the track is there that which item has different ( higher or lower) purchasing price in comparison to our forecast.
If we had used budget at item level instead, based on our budget controling setups, there wa no controling or just warning ( no rigid controlling again ) or we would have been stoped in purchasing one item in a higher amount.
Regards
Hi Adineh,
As I was testing the project module budget and forecasting functionalities some time ago I noticed when I enter a forecast and invoice a PO, the forecast will change. I was trying to replicate the scenario and provide you with more information but I cannot replicate the scenario now. Instead the invoices are not processed when I have a forecast. Please note that I was trying to post a PO/Invoice with a unit price higher than the unit price in the forecast. I get NO error message but the invoice does NOT get processed.
Anyways. I believe Ludwig provided the answers to my questions and I do not think we need to use forecasting.
Thanks,
Reza
Thanks Ludwig. It is what I was looking for.
Hi magic1949,
I don't think that you can differentiate budgets and forecasts as easy as that because there is a huge overlap of both 'concepts' and AX automatically calculates a remaining budget, which can be identical to a remaining forecast.
The maintenance of budgets and forecasts is currently not perfect and what makes things even more confusing is the fact that the budget models that one requires are setup in the project forecast setup form.
I hope that this overlap and parallelism of functionalities will be fixed with the next releases because that's really confusing.
Best regards,
Ludwig
As simple explanation at the start of a project the forecast and the budget should be the same.
Actual vs budget gives variance
The actuals for 'work done' plus the budget for 'the work still to be done' is the forecast.
For the forecast calculation, the work to be done may be updated by change control/variation order, and the budget, may or may not have been be revised via approval.
Hi Reza,
These are a lot of questions :-)
Let's try to go through them one by one
- How to copy a forecast to a budget?
Open the project budget form. There you can find an Import functionality that allows you importing data from WBS and your forecasts
- Variances
In the budgeting form you can maintain a quantity and value. Those fields are a bit 'hidden' Try to enter your $-amount as usual in the budgeting form. Once you save this amount a details button becomes active where you can enter a quantity and a price that adds up to your budget value.
What you can't do directly in the project budget control forms is splitting up the overall variance that you have against your actual data into a quantity based and a Price based variance. If you need this kind of analysis then you either have to modify the form, i.e. make an adjustment, or try to use BI tools to get that information.
Best regards,
Ludwig
Hi
You do not need to copy.
I think for this requirement You can maintain forecast at the item level for monitoring the variance between actual and plan and maintain the budget at the total project level.
What do you mean by reducing the forecast?
Regards
@Adineh,
Yes we would manually fill in the forecast.
@ Ludwig,
Thanks for your reply. It makes sense. However, I have two other questions:
1- How do you copy forecast to budget?
2- Can forecast be used to support the following scenario?
We need to be able to determine the variance between the budget and actual. We can easily do this using the budgeting feature in project module. However, we need to take one step further and determine the root cause of the variance which is either the change in the unit price or the change in the Qty. Since forecast captures both Qty and Unit price we can use it. However, it means we have to maintain two lists; one is forecast and one is budget and they can easily go out of sync.
Another issue I found is that when a purchase order is created and confirmed it reduces the forecast. Is there an option to stop this?
Thanks,
Reza
Hi,
Forecasts were used in the older AX versions before the project budget functionality was available. They basically do the same and you can copy a forecast value to a budget value. The other way around is not possible. Both features are also not automatically in sync, which means that you have to ensure that they are in sync
An important question is whether you need to use forecasts and budgets.
For normal TM projects you don't need forecasts and can track all values as budgets
If you make use of fix price projects and use special estimate procedures, then you need forecasts.
Price agreements are not directly related to your project budgets and forecasts.
Hope this answers your questions.
Best regards,
Ludwig
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