Budgeting 101: Dynamics GP Tools of the Trade

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By Scott Driggs, Custom Information Services

2009 is coming to a close and it is that time again: yes budget season. First off, if you are reading this article, congratulations! You have almost survived 2009 which has been a very difficult year for many companies. Also, the fact that you are reading this article tells me that you are forward thinking and looking for ways to improve your current processes. It is assumed that you have built a budget before. Rather, you are looking to move beyond the mechanics and tedium of budgeting to using budgets as a strategic tool that not only improves the bottom line but can serve as a framework to drive better business decision making.

At the same time, there are practical considerations when creating a budget for 2010. Odds are that 2009 was a very different year from any that you have previously experienced. This can make it difficult to base a budget using 2009 or even historical years particularly if there have been some significant industry adjustments as a result of the recession. In short, the goal of this article is to provide some practical suggestions for budgeting for next year as well as some thoughts and ideas about the process of budgeting that should lead to better stewardship of the allocated funds.

First off, make sure that you take advantage of the technology that is available to you.  Most Accounting and ERP applications have tools that allow you to budget in a number of different ways. You are most likely using an application that offers the ability to build budgets from scratch. Most also have the ability to create a new budget using the previous or a historical years budget or actual numbers.

One such tool is the Budgeting Wizard in the General Ledger module for Dynamics GP. This is a tool that really cuts down on some of the manual processes associated with budgeting. For example, you can email each department their budget in Excel, allow them to make changes and then re-import those numbers after looking them over. What if I want to budget in a way that isn’t part of the Chart of Accounts? Using the Analytical Accounting module you can create an unlimited number of user-defined transaction dimensions that can be used to budget in more creative ways.

Beyond expenses, Microsoft Dynamics GP also has more advanced tools to forecast and plan for income as well.  One such tool is Microsoft Dynamics Forecaster that among other things allows for Dynamic Revenue Forecasting.

After a budget has been set up there are still other tools to help stay on budget. Microsoft Office SharePoint Server Workflows are one example. One way that this tool is being utilized is to manage the workflow of purchase order approvals in Dynamics GP. Workflow allows you to set up business rules that route purchase orders to the appropriate individuals for approval. Below a specific dollar amount, a purchase order may only require one level of approval. Above that dollar amount and a purchase order would automatically be routed for management sign off before it can be accepted into the system.

If your current solution does not have tools like these then there are a number of independent budgeting tools that may serve the purpose. I would discourage the selection of a completely independent budgeting tool that does not allow budget numbers to be re-imported into your system. A budget totally separate from your ERP solution is not nearly as useful. Your software company and your accounting solution reseller should have a list of recommended third party budgeting tools that integrate with their product.

Now if your current solution has poor budgeting tools that are probably not a reason to swap out your solution. However, if you have the opportunity to make a system change be sure that you select an ERP solution with powerful budgeting tools that allow you to easily build and manage budgets. Good luck in 2010 and happy budgeting!

If you care to comment on the information above or have any questions please feel free to contact CIS at 682-367-1699.

Custom Information Services is a Dynamics reseller in North Texas.

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