Setting up and keeping budgets up to date is a vital step towards effective cost control and spend forecasting.
There are many ways to achieve this, so this guide will give you a summary of the various options available to you on Brightflag.
- What flags are there for budgets?
- How can I report on budgets at a more global level?
- Which date types are used for the budget charts?
- How are vendor budget requests handled?
- When editing the budget breakout, how are the numbers auto-calculated after I make a change?
- How can I set whether or not my vendors can see matter-level budgets?
Setting top-down budgets help you get the most from your matter-level budgets and vice versa. Layer this on top of your existing spend and accruals, along with Brightflag's powerful A.I. forecasting, and you'll have the complete picture!
We recommend setting one total budget for the legal function as a whole along with several breakouts of budgets for your various practice areas.
Share the results with your finance team for their thoughts on forecasting.
For more information on Financial Budgets, please refer to the following help articles
A matter-level budget can be set directly by you or requested by your vendor.
Involving your vendor in the process helps improve the accuracy of a budget and makes them aware of its importance. For this reason, we recommend that matter-level budgets should be handled through the request and review system (requested by the vendor and reviewed by you).
- Instruct your vendors to submit a budget request, either by month or by quarter.
- From there, your company's matter leads or admins can review the budget to either approve it or reject it and request a resubmission.
- When a budget request is approved, it overwrites the existing values previously entered for that time period. Where the time periods don't overlap, the original entry is retained.
Alternatively, you can skip the vendor's involvement and set the budget directly. This expands the options for budget type:
- Periodic Budgets: Set a time-bound budget
- Phased Budgets: Set a budget for each phase you have defined in the matter
How Matter Budgets Interact with Invoice Review
Any time a matter-level budget has been breached, you will see the Budget Overrun flag on the invoice (this may vary depending on your company's flag settings).
Use this as an opportunity to question the necessity of unexpected costs. If the breach of the budget is justified, capture the learnings for why and work with our vendor to set a more appropriate budget.
Reporting on Matter-level Budgets
The report builder will provide you with the overall budget for a given matter, along with valuable insights into the Matter details and spend. The All Matters and Matter Spend reports will list the total budget in the budget field. Compare this with the spend in each matter to see which matters are approaching the budget limit.
Factor in the matter details that are most relevant to your business in the interpretation of this data. Grouping the matters by a given quality (e.g. matter category) will help you determine next steps for achieving better predictability and cost control.
If your company's fiscal year does not align with the calendar year, you can customize this. This will ensure financial budgets and time-bound matter-level budgets are set accurately.
For example, if your fiscal year starts on Feb 1st, Q1 will be considered Feb 1st to Apr 30th. Please Submit a Request to Brightflag Support team to get this changed.
For a detailed list of all budget types available on Brightflag, please refer to the following help articles:
- Overview of Budgeting
- Budget Requests - All You Need To Know
- Where do matter budgets appear in Brightflag?
- Estimating a Matter Budget
- Setting & Viewing Financial Budgets
- Interpreting the Results of your Financial Budgets
- Manually Reviewing Budget Requests
What flags are there for budgets?
- Budget Total Overrun, Budget Total Overrun 150%, Budget Total Warning (75%), Monthly Budget Overrun.
- The matter summary tab also has a mini budget chart, which visualises any overrun based on your chosen default view.
How can I report on budgets at a more global level?
- Financial budgets (link) is the best place to get snapshots at how your bottom-up budgets (matters) compare with your top-down budgets (financial budgets).
- The report builder matter spend report provides the budget total for both phased and periodic budgets.
Which date types are used for the budget charts?
- The pending and approved figures can be based on either the invoice dates or billing period dates.
How are vendor budget requests handled?
- Vendor budget requests can be submitted for each month or each fiscal quarter. These requests can only be made to the current or future months. They are not restricted by the budget end date you have set.
- When approved, the months and quarters are updated on the matter budget for the given vendor. The amount the vendor requests replaces the existing amount,
- Quarterly budget requests have their quarters split across months evenly, with any remainder added to the last month.
- When requests are approved in a batch, all requests in that batch are applied in submission order. If the months overlap for a given matter and vendor, the value from the most recently submitted month is applied.
When editing the budget breakout, how are the numbers auto-calculated after I make a change?
- Changing the totals (monthly total, vendor total, or unassigned total) updates the relevant monthly cells proportionally.
- Changing the vendor cells or monthly totals will first look to update unassigned. Where the unassigned is insufficient, the monthly totals and/or matter total are increased.
- Changing the unassigned cells will only update the monthly totals and matter total (i.e. the vendor monthly cells or vendor totals stay stationary).
- Changing the matter total on its own is not permitted.
How can I set whether or not my vendors can see matter-level budgets?
- This can be set in Matter Settings, on the tab for Matter Form: