Best practice is to limit the number of analysis codes you link to the budget and must then maintain. This section uses a fictional budget structure and analysis codes to illustrate the options to consider when designing your budget structure and the related analysis codes.

Your organization wants to create a budget structure to include in financial reports. The budget consists of:

You can use three distinct data models to implement the budget structure and analysis codes for this example. The following sections discuss the advantages and disadvantages of each approach.

In the first model, the budget structure requires 150 unique budget combinations. Therefore, the budget consists of 150 topics. If each topic has its own analysis code, you also need 150 analysis codes. This model is time-consuming to create and maintain.

Using the second model, you associate three analysis codes with each topic. Although you need 150 topics, you only need 18 analysis codes: one for each country, cost center, and cost category.

Using the third model, you must also create and maintain 18 analysis codes. Because the structure is hierarchical, you need an extra topic for each parent level. You may need as many as 190 topics.

Therefore, the recommended approach for budget structures of any complexity is to avoid model 1 and to use model 2 or model 3. In practice, model 3 is the best.

When you assign analysis codes and link them with topics, the budget amounts are retrieved when you run a financial report. The budget column amounts are displayed wherever an analysis code match is found between the codes in the financial report and the codes in the budget.

If analysis codes match, the matching budget topic is always found, even if the hierarchy in the budget does not match the hierarchy in the report. For example, in Budget and Report Match, a match is found for the Salaries analysis code in the budget and report, even though the hierarchy is different.

When you are linking budgets to reports, analysis codes that identify entity dimension details are important. There are several scenarios to consider.

When the budget and report tree contain entities, only matching entities can result in a budget figure on the report. For example, a budget can contain the budget for a particular subset of entities. The corporate report contains amounts for all entities. In this case, only the entities where a match is found have information included from the budget in the report. In Budget and Report Tree Contain Entities, the China entity is not in the budget so no match is found in the financial report.

The read-only list of entities in Budget Create is the complete list of all potential entities for the associated report chart. However, when you run a report without entities against a budget without entities, the report output includes data for all entities in the report cube. The budget is assumed to be valid for the same list of entities, which can be a subset of the list in the Budget record.

You can create a budget with entity-level detail. However, the financial report is set up to give the consolidated group-level view. In this case, the system ignores the entity-level analysis codes in the budget, and the topics matching over other dimensions are rolled up to compose the cross-entity budget. This principle also applies for other dimensions.