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Important
Some or all of the functionality noted in this article is available as part of a preview release. The content and the functionality are subject to change. For more information about preview releases, see Service update availability.
This article describes how to control what happens to the carry-forward budget when purchase orders are canceled or reduced, and when invoices are reduced.
For information about how purchase orders are processed at year-end, see Process purchase orders at year-end.
Turn carry-forward budget reductions for invoice variances on or off
The carry-forward budget can always be updated when a purchase order is canceled or reduced, and when an invoice is reduced.
Purchase order reductions and cancellations
The carry-forward budget is updated when a qualifying purchase order is canceled or reduced. You can set each general ledger fund to respond in one of the following ways:
- Preserve the carry-forward budget as it was created.
- Automatically adjust the carry-forward budget to remove the canceled or reduced amount.
Only purchase order lines that have distributions that include a fund are available for automatic budget adjustment. The automatic budget adjustment occurs when the purchase order is finalized or a purchase order reduction is confirmed.
Invoice reductions
You can specify whether each fund should reduce the carry-forward budget when an invoice is reduced, in addition to when a purchase order is reduced or canceled. The invoice must be for a purchase order that has carry-forward budget. Reductions include price variances, charge variances, and tax variances. When a carry-forward purchase order is reduced during invoicing, a variance is created. When the invoice is posted, the purchase order encumbrance is reduced by the amount of the variance. The automatic budget adjustment is created for the amount of the variance.
Configure the carry-forward budget options for each fund
For each general ledger fund that reduces the carry-forward budget when a purchase order or invoice is reduced, follow these steps.
- Go to General ledger > Chart of accounts > Funds > Funds.
- Select the fund that you want to set up.
- Under Purchase order year-end process, select the Override selected year-end option option.
- Under Carry-forward budget status, set the Reinstate the budget when a carry-forward purchase order is canceled or reduced field as needed.
The option settings work in the following way:
- No – For invoice variances, a budget register entry is created against the purchase order for the amount of the variance reduction. For canceled or reduced purchase orders, a budget register entry is created for the remaining balance.
- Yes – For invoice variances, the invoice reduction is allowed, but it doesn't create a budget register entry. The carry-forward budget remains available for consumption by other documents. For canceled or reduced purchase orders, the cancellation or reduction is allowed, but it doesn't create a budget register entry. The carry-forward budget remains available for consumption by other documents.