Budget Management in Odoo

Functional Accounting

Budget management is a very important thing for any business organization. Using the budget, we can analyze the performance of our company by comparing the actual amount we spent and the planned expenditure.

How to configure the budget in Odoo?

1. Enable Budget Management

Go to Accounting -> Configuration -> Settings

Tick the ‘Budget Management’ feature. The ‘Analytic accounting’ feature will be enabled automatically while doing this.

By enabling the budget management feature, you will get three new menu items as marked in the picture.

2. Set Budgetary Positions

Go to Accounting -> Configuration -> Management -> Budgetary Positions

Here we can define accounts linked to the budget.

The next step is set Budget.

3.Set Budget

Go to Accounting -> Adviser -> Budgets

Create a budget

Note: In the Budget line, the field Analytical account is set as not mandatory by Odoo. But for the proper working of Budget 'Analytic account' is mandatory. So, don't forget to put the Analytical account in the Budget lines.

You can create a new analytic account or select an existing analytical account from the budget lines.

Then confirm the budget.

Once you confirm, the budget report is created. To check the budget

Go to Accounting-> Reports -> Management -> Budgets

There you can check the fields, Planned Amount, Practical Amount and Theoretical Amount

Planned Amount: The amount that you have planned for that budget.

Practical Amount: How much amount you have spent in that budget.

Theoretical Amount: It represents the money you theoretically could have spent / should have received till the date. For example, your budget is 24000 for 12 months (January to December), and today is 31 of January, then the theoretical amount will be 2000.

Now we can check the effect of the budget report after creating some journal entries. For that, I am creating a Purchase Receipt.