Enterprise Resource Planning Blogs by SAP
Get insights and updates about cloud ERP and RISE with SAP, SAP S/4HANA and SAP S/4HANA Cloud, and more enterprise management capabilities with SAP blog posts.
Showing results for 
Search instead for 
Did you mean: 
0 Kudos
This is a detailed blog post as part of series in the context of SAP Business ByDesign capabilities related to active budget control -  see main blog post:  Active Budget Control in SAP Business ByDesign

Overview budget release

The active budget check during purchase order creation or supplier invoice creation is conducted using the ‘released budget YTP – (actuals + encumbrances)’ as a reference. To release portions of your planned budget in consecutive steps gives customers significantly more control on the spending behavior in the overhead cost area.

Example: The yearly financial plan including the overhead budget has been signed off. To avoid critical budgets being spent in the first quarters spending behavior can be controlled by releasing every quarter the necessary budget for the next quarter. The picture illustrates the case in which the customer releases the budget for the upcoming quarter shortly before the start of the quarter.

Example: Quarterly Release of Budget


Please note that in this example depreciation and internal allocations were immediately released for the entire year. Whereas the budget categories Travel and 3rd Party are to be released in quarterly steps. Please also keep in mind that with multiple uploads the additive delta mechanism is in place. The already released budget adds up with the entries in the just uploaded budget. In this example Q1 release + Q2 released budget = available budget in Q2.

Budget release – in more detail

In case budget check capability is switched on, an additional work center view in the areas of cost & revenue becomes available and can be assigned to the financial accountants authorized to release budget.

Work Center View - Budget Release

To do so please use the application and user management and assign the work center view indicated below:

Assignment of Work Center View Budget Release in Application and User Management

The capabilities in the budget release work center view have many aspects in common with the planning work center view.

Budget Release Versions - Excel Template

Multiple versions of released budget can be created for a company, set of books and fiscal year. I personally strongly recommend the following:

  • I would use in a productive environment only one released budget version per company, default set of books and fiscal year

  • Budget availability check is executed against the default set of books only. Therefore, it is of very limited operational use to release budget for the (optional) parallel set of books.

  • Use the same budget release version ID than the plan version ID.
    It is not required but makes it easier to identify which budget released version relates to which plans version.

If you are familiar with plan versions, you see the individual elements again. Here you can also write notes and attach files you used to document the budget release data uploads for example. For example if you upload prior to begin of the quarter the released budget you could attach every released budget upload here to properly document the applied adjustments.

Budget Release Version - Detailed Screen

Relationship plan version and released budget version

Let’s focus on a simple example in a single company, one set of books and a given fiscal year.
During creation of a new budget released version it will be automatically related to the plan version  currently defaulted valid at that point in time of creation.

Example: Relationship Budget Release Version - Plan Version

During the creation of the budget release versions (BR01, BR02, BR03) the plan version V001 had been set as ‘default’ and therefore all these three budget release versions are related to plan version V001. Keep in mind: Only the default budget release version is used for the budget check. The other budget release versions are of no operational use. Personally to keep things simple I only see customers using multiple release versions for a given company, set of books and fiscal year only in very rare occasion.

Creation of a budget release version and uploading released budget

A new budget release version is created by filling the entry sheet and saving the data to the SAP Business ByDesign system. The new created budget release version is automatically related to the default plan version at that point in time.

Budget Release Version - Entry Sheet

But why is this of any relevance?

  • The budget monitoring reports use data only the default plan and the default budget released versions

  • Budget check only uses the defaulted budget release version as basis

The system checks some constraints during the upload of data

  1. Does plan data consist on the level where you want to release budget?

  2. Is the used G/L Account assigned to a budget category?

  3. Does the total of released budget exceed the year total of planned amount?

If one of these criteria is not fulfilled a save of the data to SAP Business ByDesign is not possible and error messages indicate the constraint violation.

Option: Budget release amounts not allowed to exceed planned amounts

The budget release amounts are by default not allowed to exceed the related year total values in the plan version. There is an option in the budget version though to control this.

Budget Release Amounts allowed to Exceed Plan Version Amounts

My personal opinion, on this how this will be used in reality:
- Public sector:  not allowed to exceed
- Non-public sector: allowed to exceed

For many customers the agreed financial (yearly) plan shall not be changed due to required adjustments for spending in some selected business areas and/or budget categories. In order to assure that still required services or products can be procured an increase of budget released is possible without having to increase the plan - if this option is switched on.
In public sector usually the policy plan >= released budget has to be enforced. For other industries the capability to exceed the planned budget by increasing the released budget might be the preferred method. In the reports ‘Cost Centers - Budget Monitoring’ and ‘Projects – Budget Monitoring’ these differences can be tracked.

What does this property of the budget release version influence? There is in principle one simple rule and constraint that will be checked during the upload of the released budget amounts:

For any combination of released budget entry, the yearly released budget must be less or equal than the year total planned amount in the related plan version.

I would like to use a simple example again to illustrate what it means.

Example - Released Budget Exceeding Planned Amount

Multiple aspects can be seen in this simplified example:

  • The constraint is in place that the released budget (year total) must not exceed the planned yearly budget (year total) at a granularity of cost center, budget category and G/L Account

  • In this example the upload from the excel template to SAP Business ByDesign would be rejected because for cost center ABC and budget category Travel the ‘to be released’ amount of 2500 exceeds the planned budget of 2400!

  • The yearly plan data anticipates when the actual posting will occur.

  • The released budget should consider when the ordering process must happen and needs to consider some lead time before the goods are delivered or the services are performed. Therefore, releasing larger amounts for example at the beginning of a quarter is a common practice.

  • For not directly influenceable costs like depreciation or allocations I would recommend  to also release the budget. We anticipate that customer in many cases will release the budget in a 1:1 like planned. This might be useful if you have processes established with Journal Entry Vouchers – also here a budget check can be enforced by a partner extension! By default no budget check is enabled for journal entry vouchers.

If you would like to switch this property back that the planned amounts have to larger than the released amounts it will be checked that this constraint is met. If in the meantime the released budget exceeded the planned amount it cannot be reverted.

Special topic: Having to adjust the released budget

Follow me on a small business story that might sound familiar to you. It is a common practice that cost center responsible might want to switch the available overall budget in one budget category to another without exceeding the overall budget of the cost center. Customers for example could establish a request workflow and if it is approved the accountant could adjust by simply uploading the deltas.

How would such an adjustment look like to an existing plan version and budget release version? I would like to use the the example illustrated before. The budget could not be released for cost center ABC because the budget category Travel exceeded the planned budget. The manager got the approval to shift 100,00 USD from 3rd Party to Travel.  The simplified illustration shows the steps an authorized accountant must make in this use case (assuming released budget is NOT to exceed planned amounts)  :

Step 1:  Adjust the plan 3rd party budget is reduced by -20 for period 007-011.
Travel budget is increased in period 007 by 100

Step 2: The adjusted plan year totals
The accountant checks the adjusted year totals

Step 3: Release of budget. Now the accountant can release the budget with reduced budget for 3rd party and increased budget for travel.

Please note: the system does not explicitly enforce any balancing checks on the plan or released budget changes. These constraints are not adequate to quickly adjust the planning or budget release of business environments changes quickly. Since the ability to change financial plans or released budgets is task of a financial accountant the customer can put other controls in place if required.

Plan and Released Budget Changes

Special topic: reassigning budget release version to another plan version

In rare occasion it might be required to assign a budget release version to another plan version. Since this usually has significant implications (especially in public sector for the auditing control) the process is by purpose split into multiple steps to avoid an accidental or unwanted reassignment.

Here are the steps to conduct the change of the reassignment to another plan version. This is possible on the UI of the plan version as a dedicated action.

  1. In case the release version is set to default please switch off the default.
    Otherwise the action to reassign the plan version is not available.

  2. Assign the new plan version
    Constraints that are checked:
    a) Any combination of budget category, G/L Account / cost center / project that has been entered in the release version must be available in the to be assigned plan version
    b) In case the budget version values are not to exceed the plan version this is cheked as well
    c) In case the constraints are not violated the plan version is assigned
    d) Attention: At this moment the newly assigned plan version will become the default plan version

  3. Please switch on the budget release default flag.

As a result, we now have a defaulted plan and a defaulted release version that are used in analytics and for budget check


In this blog post the relation between plan versions and released versions are explained as well as the process to release budget and fill the amounts. The similarities using the excel plugin to upload and adjust data for plan versions and released budget versions should have become clear.  The essential constraint that cumulated planned amount larger than cumulated released amount is a key constraint that needs to be considered. In addition to allow the released budget to exceed the planned amount might be an option that supports your type of business better or internal policy.
Finally it is pretty powerful to release budget in steps after reassessing the financial and spending situation on a regular basis.

Feel free to share how you would use these capabilities to your customers benefit?

Back to main blog post: Active Budget Control in SAP Business ByDesign