How Budget Validation Works

PayInvoice Next validates budget availability at key checkpoints in the procurement cycle. This page explains the formula, the checkpoints, and how the system decides whether to block, warn, or allow a transaction.

The Budget Formula

At any point in time, the Available Budget for a WBS code is:

Available Budget = Original Budget
                 + Additions (Supplementary Budgets)
                 − Reductions (Budget Decreases)
                 + Transfers In
                 − Transfers Out
                 − Consumption (Committed + Actual)

Where:

• Committed = total of submitted Purchase Orders not yet invoiced
• Actual = total of submitted Purchase Invoices

When you submit a new transaction, the system compares the transaction amount against the Available Budget for the selected WBS code.

Validation Checkpoints

Budget validation can be enabled independently at each of these stages:

Checkpoint	When It Fires	What Is Checked
Purchase Request	On submit of a Purchase Request	Annual budget and accumulated monthly/quarterly budget against the WBS code
Purchase Order	On submit of a Purchase Order	Annual budget and accumulated monthly/quarterly budget against the WBS code
Goods Receipt Note (GRN)	On submit of a GRN	Annual budget and accumulated monthly/quarterly budget
Purchase Invoice	On submit of a Purchase Invoice	Annual budget and accumulated monthly/quarterly budget against the WBS code
Actual Expenses	On booking actual expenses	Annual budget and accumulated monthly budget (via WBS Budget settings)

Each checkpoint is independently configurable through Budget Settings and per-WBS WBS Budget records.

Enforcement Actions

At each checkpoint, the system can take one of three actions if the budget is exceeded:

Action	What Happens
Stop	The transaction is blocked. The user cannot submit until they reduce the amount, increase the budget, or select a different WBS code. The error message shows the WBS code and the shortfall amount.
Warn	The transaction is allowed, but the user sees a warning message. The transaction can still be submitted. This is useful for soft limits where management review happens after the fact.
Ignore	No check is performed. The transaction submits regardless of budget availability.

How Enforcement Is Configured

Enforcement is controlled at two levels:

1. Global — Budget Settings

Navigate to Budget > Budget Settings to see organization-wide defaults:

• Enable/disable budget checks per transaction type (Purchase Request, Purchase Order, Purchase Invoice, GRN)
• Set the default action (Stop/Warn/Ignore) for annual budget and accumulated monthly/quarterly budget at each checkpoint

2. Per-WBS — WBS Budget

When you create a WBS Budget entry (the detailed, account-level budget), each entry carries its own enforcement settings that can override the global defaults for that specific WBS code.

Monthly and Quarterly Budget Checks

In addition to the annual (overall) budget check, PayInvoice Next can validate against accumulated monthly and accumulated quarterly budgets. This prevents front-loading spending in the early months of a budget period.

• Accumulated Monthly: The system checks if spending in the current month exceeds the monthly allocation (from the Monthly Distribution pattern).
• Accumulated Quarterly: Similar check against the quarterly allocation.

These checks are independent of the annual check and can have different enforcement actions. For example, you might set:

• Annual budget exceeded → Stop
• Monthly budget exceeded → Warn

This allows transactions that stay within the annual budget but temporarily exceed a monthly allocation.

What the User Sees

When a budget check stops a transaction, the user sees an error like:

"Budget exceeded for WBS code [CODE]"

The user's options at this point are described in Handling Budget Overruns.

When a budget check warns, the user sees a warning dialog but can proceed with submission.

Related Pages

• Handling Budget Overruns — What to do when budget is exceeded
• Budget Entry Overview — How budget balances are calculated
• PO with Budget Control — Budget checks specific to Purchase Orders
• PI with Budget Control — Budget checks specific to Purchase Invoices