Concept

Budgets

A Budget plans an amount per Account for each Budget period. Budget periods, set and unset amounts, natural signs, notes, actuals, estimating from past Transactions, and the budget reports.

A budget is a tool for estimating expected income and expenses. It lets you plan how your finances should change over a period, and compare your actual Transactions to the plan.

Kinds of budget

  • A cash budget plans receipts and disbursements: where the money comes from, where it goes, how much.
  • An expense budget plans what you spend; it ignores things like loan repayment, though it counts interest. Buying 100 of groceries on a credit card is a 100 expense; paying the card bill of 110 adds 10 of interest expense, and the repayment of the 100 is not budgeted.
  • A capital budget plans how to pay for a large future expense, with savings and borrowing.

The kind is decided by which Accounts you give amounts to. Expense Accounts only make an expense budget; assets, liabilities, income and expenses together make a cash flow budget. Your Accounts must be at least as specific as your budget: you cannot budget for electricity and water separately with only Expenses:Utilities.

What a Budget holds

A Budget has a name, a description, a number of Budget periods and a Recurrence that dates them. The common periods are a month or a year; several periods in one Budget let you plan for seasons (an annual budget of 12 months, with more for heating in winter).

Budget period p is numbered from 0. It runs from the Recurrence's p-th occurrence to the day before the next. ⚠ A Budget period has nothing to do with the accounting period of the Configuration.

For each Account and period the Budget has:

  • a Budget amount: what you plan for that Account's balance to change by. Amounts are kept as written, with no rounding to the SCU;
  • a Budget note: free text.

An amount is set or unset. An explicit zero is set. Only an unset amount lets a report sum the Account's children instead. ⚠ Unset is not zero, though GnuCash reads both as 0; red-ale's methods never confuse them, null is unset and "0" a set zero.

A book may hold several Budgets. The one reports start from is the default budget, named by a book option (book.options); if none is named, the first.

Natural signs

Budget amounts carry the engine's sign, as the actuals do: debits positive, so an expense budget is positive, an income budget negative and a liability increase negative (Double entry). GnuCash has stored them so since 3.8, and the Book feature Use natural signs in budget amounts says a book's amounts are. ⚠ Natural means unreversed, not the sign a report shows.

A book from before 3.8 holds Budgets without the feature and with amounts signed as the user's preference then. red-ale never converts on opening. Its budget methods that change anything refuse with conflict until you run budget.scrubSigns, GnuCash's own scrub; budget.list tells you when (needsSignScrub).

Making one

  1. budget.create with a name, the number of periods and a Recurrence (the default: monthly from the start of this month). The first Budget in a book sets the natural-signs feature.
  2. Fill in amounts with budget.setAmounts, by hand, all or none, for many cells at once, or
  3. let budget.estimate work them out from past Transactions: it takes a start date, looks at the same number of periods from there and stores each Account's change, rounded to a number of significant digits (useAverage stores the average in every period). It overwrites every period of the Accounts you name, so it is a destructive method.
  4. Add notes with budget.setNotes.

budget.copy copies a Budget, budget.update changes its options and budget.delete removes it. budget.get returns it with its periods, amounts and notes.

Actuals and reports

The actual for an Account and period is what that Account and its sub-accounts did in the period: the change in its no-closing balance (Closing transactions left out), sub-accounts converted to the Account's commodity. It is computed and never stored. The Budget Report shows the planned and actual amounts side by side for each period; the Budget Income Statement and Budget Balance Sheet are the statements as the budget predicts them, and the Budget Flow and Budget Chart compare them. Pick the Budget with the report's Budget option. See Reports.