You use the budget functions in SAP Business One to track corporate expenses and revenues. SAP Business One has an encumbrance function that allows you to block additional transactions if the budget is exceeded. SAP Business One can calculate budget amounts automatically based on a series of distribution methods that you specify. For example, you can base budget amounts on a previous year’s budget and mark them up by a certain factor if you expect expenses or revenues will increase by a certain percentage. The markup can be distributed equally to all accounts or incrementally. SAP Business One can automate the process, but your accountant should help decide what distribution method to use.

In the course of routine work, SAP Business One checks the debit side of accounts for which you have defined a budget amount, and, if the budget is exceeded, issues a warning or blocks the action, depending on which method was chosen.

To begin the process of defining a budget, set the required options in the:

Administration > System Initialization > General Settings > Budget tab

For all other budget functions, go to:

Main Menu > Financials > Budget