In Forecast, every program is associated with a budget type. The budget type determines the type of projects that can be added to a Program and provides control and restrictions on the accrual and distribution of revenue on the projects within the program. There are three different budget types available for Programs.
This article includes:
Overview of Program Budget Types
A program can have one of three budget types, Uncapped Revenue, Capped Revenue, and Fixed Price. In this section, we examine each of these budget types and how they work.
Uncapped Revenue
Uncapped Revenue is a program budget that does not have an associated overarching budget. It may contain projects of any budget type and aggregate financials from the projects to the Program.
As depicted below, the Program Financials for an Uncapped Revenue program will show various values as aggregated from all projects, regardless of the project's budget type, contained within the program.
Capped Revenue
A program with a Capped Revenue budget type has an associated revenue cap which exerts a revenue constraint from the Program to the projects. It may contain projects of any budget type and the addition of projects, as well as the addition of revenue within projects already in the program, can be controlled to prevent the cap from being exceeded.
As depicted below, the Program Financials for a Capped Revenue program shows similar values to an Uncapped Revenue program, with the addition of variances showing the differences between key categories of Revenue and Value of Service with the cap.
When this budget type is selected the main point that is monitored by it in relation to the cap is the Confirmed Revenue. Confirmed Revenue is the sum of the total revenue of fixed-price projects and fixed-price retainers (fixed price + price of billable expenses on top of the fixed price) and revenue to date on T&M projects, T&M retainers, and Fixed Hours Retainers (actual billable time and expenses to date).
If the Confirmed Revenue of the projects hits the cap implemented on the Program, the user will be met with the below messages warning them that they cannot add additional revenue to the project and therefore the Program.
It is possible, however, to edit the cap of the program by editing the existing cap. This will allow users to keep adding additional revenue to the projects if it is necessary.
To edit a program's capped revenue
- Click Projects in the top bar.
- Select Programs from the dropdown.
- Click Financials within the Program.
- Click the three-dot icon in the Program Budget Overview window.
- Click Edit program budget.
- Click Edit Cap.
- In the Program cap amount field, change the revenue.
- Click Confirm changes to change the capped revenue.
Fixed Price Revenue
A program with a Fixed Price Revenue budget has an associated Fixed Price budget which also exerts constraints on the projects that fall under it. When this budget type is selected, projects being added to the Program may only have a budget type of Fixed Price, Fixed Price Retainer, or Non-Billable projects. Projects using T&M, T&M retainers, or Fixed Hours retainers cannot be added to the program.
The program Financials tab shows relevant values for the program, as shown below.
The overarching Fixed Price budget is distributed amongst the billable projects in the program. Proportions of the program's Fixed Price can be allocated to the Fixed Price projects within the program and such an allocation will act as the project's fixed price amount at the project level. The amount allocated to Fixed Price Retainer projects is dictated by the periods and period targets within those projects. Non-billable projects have no allocated revenue.
The distribution of the Fixed Price can be edited at any point in time if it is necessary to shuffle the distributed amount around the projects.
To edit the distribution of the Fixed Price on a Program
- Click Projects from the top bar.
- Select Programs from the dropdown.
- Click Financials within the Program.
- Click the three-dot icon in the Program Budget Type window.
- Click Edit Program Budget.
- In the field under the column New allocation (amount), enter the amount that should be distributed per project.
- Click Apply to apply the new amount.
- Click Confirm Changes.
In the same manner, the overarching Fixed Price of a Program can also be edited if necessary.
To edit the Fixed Price of a Program
- Click Projects in the top bar.
- Select Programs from the dropdown.
- Click Financials within the Program.
- Click the three-dot icon in the Program Budget Type window.
- Click Edit Program Budget.
- Click Edit Fixed Price located next to the current Fixed Price.
- From edit program budget, change the Fixed Price.
- Click Confirm changes.
It is important to note that only Fixed Price, Fixed Price Retainer, and Non-Billable projects may be added to a Program with a Fixed Price budget type. If the user attempts to add more of these budget type projects (with the exception of Non-Billable projects) to a Program and their revenue exceeds the Program's Fixed Price, the user will be prevented from completing the action by the following message:
Configuring the program's budget
A program's Budget Type can be changed from the Program's Settings page by Program Owners. It is important to remember that users with the 'View Financial Information' permission will be able to monitor all of the Program's financial information from the Program's budget page.
To configure or edit a program's budget type
- Click Projects from the top bar.
- Select Programs from the dropdown.
- Click Settings.
- Click Change Budget Type to select which budget type the program should follow.
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