Subscribe to and configure Spend Management

Spend Management provides an easy way to control expenditures based on a specified budget.

Most notably, when you configure Spend Management, you define:

• The specific budget to use.
• The dimensions to validate against.
• Your reporting period and the duration of the budget validation.
• The applications (Purchasing, Accounts Payable, General Ledger) in which you want to validate transactions.
• The action to take if a transaction causes a budget overage.

Read Spend Management overview and Spend Management validation for more information about Spend Management and how it works before you configure Spend Management.

Considerations

Before you can configure and start using Spend Management, you must have a budget against which Spend Management tracks spending and applies spending limits.

• You use Accrual or Accrual and Cash books. Cash-only books are unsupported.

• Budget: Though you can create multiple budgets, only 1 budget is used with Spend Management. Consider creating a threshold budget for use with Spend Management only. This sort of budget can represent 90%—or some other percentage—of your total actual budget. Therefore, Spend Management sends warnings when you've reached this threshold, better preparing you for any adjustments needed for your actual budget.

  Align Spend Management with your budget. For example, if the budget is set as quarterly, and Spend Management is set to validate on a monthly basis, Spend Management will not find a budget for each month. In this case, it will not validate your transactions correctly. If the budget is monthly, Spend Management sees the budget and validates accordingly.
• Dimensions: To validate against a budget that includes dimensions, the selected dimensions are evaluated on transactions in the selected applications. This means that all dimensions that you select must be enabled in all selected application areas before Spend Management includes them in calculations.

• To validate committed expenses, either through direct entry or from open purchase transactions in Spend Management, you need to configure a user-defined book for tracking committed expenses.

  The user-defined books for Spend Management are typically used to track committed expenses when they are released and open purchase orders when they are converted to PO purchase invoices. User-defined books are enabled in Configure General Ledger. For companies with more than one entity—consider which entities you want to include in Spend Management validation, and which entities to exclude.

Subscribe to Spend Management

Spend Management is an additional application that integrates with other applications to validate expenses across your company.

1. Go to Company > Admin > Subscriptions.
2. Scroll down to the Spend Management subscription item.
3. Select the Spend Management slider, and then select Subscribe.

Configure Spend Management

Spend Management integrates with Purchasing, Accounts Payable, or General Ledger to validate expenses in your company.

1. Go to Company > Admin > Subscriptions, and then select Configure beside Spend Management.

   Alternatively, go to Budgets > All tab > Spend management.

   If this option is grayed out, you likely do not have permissions to configure Spend Management.
2. Enter the Budget information.

   Budget information

   Budget name (required)	Select the budget that Spend Management validates against. Budgets must have amounts entered for the account and dimension combinations that you want to be validated. The budget amounts must cover the period of time that you choose to enforce spend controls. Consolidated budgets cannot be used with Spend Management. This is because consolidated budgets are in a single currency for all entities, and Spend Management validates against the base currency of each entity. Instead, you can create a single budget for all entities so that it validates against each entity's base currency appropriately. This budget does not have to be the same budget you use in reporting. Instead, you can use a threshold budget that's based on a percentage of your usual company budget to receive warnings before you reach your actual budget overage.
   Start budget period (required)	Select a start date to tell Spend Management when exactly to begin expense validation. Use the start date of a period that's set up to be used for budgeting. This ensures that periods cannot overlap and do not conflict.
   If a budget has no match, treat budget as zero	Select this checkbox to enforce validation in transactions that don't match any account-dimension combinations for the budget period being validated. When enabled, if a budget has no match, Spend Management validates the transaction as if it has a budget of R0.00. For instance, if there isn’t a budgeted amount for that period for the location and department combination included in the transaction, then Spend Management will treat this combination as having a budget of R0.00 and triggers the stop or warn notification when it's submitted. If this feature is disabled, transactions without matching account-dimension combinations will be submitted or posted without being validated.

3. Enter the Notification information.

   Notification information

   Overbudget notifications	Select this checkbox if you want to receive email notifications on budget overages that occur during a set time interval. Email notifications are only sent on those transactions that result in a budget overage. For example, Purchasing is configured to stop if the specified budget is exceeded, but Accounts Payable is configured to warn. You’ll receive email notifications on budget overages related to your AP supplier invoices only because Intacct will prevent any transactions posted in Purchasing that exceed the budget.
   Budget administrator	Enter the valid email address of the person you want to receive the budget overage notifications. Only one email address can be entered. The person who receives the budget overage notifications should be someone who can make budget decisions and/or adjust the budget in Sage Intacct as needed.
   Notification preference	Choose how often you want to receive budget overage alerts. Your choices include: Days Weeks Months Be sure to select a notification preference that's easy to read and does not overwhelm the recipient. For instance, if you at first receive monthly notifications that have too many table rows, switch your preference to a more frequent option, like weekly or daily.

4. Enter the Validation information.

   Dimensions

   Validation information dimensions section

   Dimensions

   Select the dimensions to include when spending is validated. Dimension validation is optional. If you select dimensions, Spend Management validation is enforced for all dimensions in transactions entered in the selected applications. Spend Management uses the dimensions that you define on the Purchasing configuration, Accounts Payable, and the General Ledger configuration pages. Be sure the dimensions that you select here are enabled in every application that you select.

   Skip validation in selected entities

   In companies with more than 1 entity, you can exclude certain entities from Spend Management validation. Select those entities here.

   Duration

   Validation information duration section

   Default duration

   In addition to the start date, you need to define the time interval under which Spend Management validates the budget. Select that period that matches how your budget was created to validate expenditures: For companies with more than 1 entity that use a fiscal year, keep in mind that fiscal year can be separately defined for each entity. Current month: Validate expenses for the month based only on the budget for that month. Current year: Validate expenses based on the total budget for the year. Current year through current month: Validate expenses based on the year-to-date budget for the current year, up to and including the end of the current month. Fiscal current year: For companies that don't use the calendar year but use a fiscal year, Spend Management can validate for the budget total of the fiscal year. Fiscal year through current month: For companies that don't use the calendar year but use a fiscal year, Spend Management can validate the fiscal year budget from the start of the year through the end of the current month.

   Use project begin and end date

   This option only appears if you’ve selected the Project dimension to be included in your validated dimensions. When enabled, the project begin and end dates defined in the project related to the transaction submitted are used to validate the budget. If no project begin and end date is available, the Default duration is used instead. Enabling this option also prevents transactions from being posted if the transactions don't align with the defined begin and end dates. This can be helpful if you want to ensure that project costs are entered during the project's valid dates, not before or after.

   Applications

   Validation information applications section

   Validate Purchasing Validate Accounts Payable Validate General Ledger	Select a checkbox besides an application option to enable validation in that application and its transactions. Further setup, as described in the Purchasing section, is required if you choose to Validate Purchasing.
   If budget is exceeded	Choose the validation behavior on budget overages: Stop: prevents transactions from being submitted or posted if they exceed the budget. To move forward with these transactions:  Adjust the amount of the transaction to be within the budget parameters Place the transaction in Draft mode until your budget administrator can adjust the budget. Otherwise, these transactions cannot be posted. Warn: warns users when they’re going to submit or post a transaction that exceeds the budget. Users can put the transaction in Draft mode, and then talk to the budget administrator about how to handle the budget overage. Or they can submit or post the transaction anyway. The transaction is then included in the budget overage notification emails sent to the budget administrator if you’ve configured that option. If your GL journal entry imports fail due to over budget warnings, select the Ignore Warnings checkbox in the import window before you import any transactions. These control options are independent for each application selected to offer flexibility based on the type of transactions.
   Account group	Select a specific account group that holds all the accounts in your budget you want to validate in your GL transactions. For example, you might make an account group for your expenses or capital purchases and choose it here. Learn more about Add an account group.

5. Enter the Committed Expenses information.

   Committed expenses information

   Include committed expenses

   Select this checkbox to Include committed expenses in your available budget calculations. Committed expenses are used to reserve a portion of the budget for planned obligations such as supplier contracts or other purchases. The amounts can be directly entered into a user-defined book or they can be generated from Purchasing transactions. If you track committed expenses in a user-defined book and use Purchasing Spend Insight calculates based on the primary General Ledger posting that's set up for the transaction definition. If you've enabled additional posting, that secondary posting is not reflected in Spend Insight. For example: You've set up Spend Management to include committed expenses and created a user-defined book to track them. You have a purchase order transaction definition set up to post to the committed expenses book. You want the amount posed in the committed expenses book to be deducted from your committed expenses when you view Spend Insight information in the purchasing AR sales invoice. The best practice: Create a transaction definition that falls immediately before the AR sales invoice in the purchasing workflow. Set up this transaction to release the invoice amount from the committed expenses book. This step also ensures proper clearing of the committed expenses book and avoids the need to adjust for variances between the purchase order total and the AR sales invoice total.

   User-defined books

   Select 1 or more user-defined books that contain the committed expenditures entries.

6. Enter the Purchasing information.

   Purchasing information

   Purchasing document

   Select 1 or more types of transaction definition documents in Purchasing to validate the budget actuals against. In companies with more than 1 entity, the Created at field specifies whether the transaction definition was created at the top level or the entity level. This determines the availability of the transaction definition in all entities. Spend Management validation does not support returns. We generally recommend that you avoid the use of negative amounts, which naturally pass through the spending validation and purchase requisition documents. If a negative number is used in a transaction, the number is added to the budget rather than counted against it, so the transaction will automatically pass validation. Transaction definitions that use the workflow category Return do not appear in the selection list.

7. Enter the Item GL Group information.

   Item GL group information

   Default item GL group account

   Items that use non-posting transaction definitions do not include a mapping configuration that maps Item GL groups to the general ledger accounts to which they post. To validate spending transactions based on items, specify which area of the budget (general ledger group account) the transaction is budgeted against. This is necessary because the transaction definition does not specify the budget area. As a catch-all, assign a default group account for expenditures. The best practice is to map your General Ledger accounts for all item general ledger groups individually. Then set the default to an account with a zero budget.

   Item GL groups

   For item general ledger groups on purchase transactions, define the General Ledger account associated with the item. For multi-entity companies, you'll see the entity that created the general ledger group. Include the item general ledger group and general ledger account for all items to be validated. Select from the list of Income Statement accounts and Balance Sheet accounts. You can also CSV import: Item GL groups to GL accountsto save time by selecting Import mapping. Save time setting up this mapping by starting with a Purchasing transaction definition that already contains the mapping you want. Copy and paste that information into the mapping import template, and make any necessary edits.

8. Select Save.