• Financial Settings in a Budget


    When creating a new budget, or extending an existing budget into a new financial year, you will have the opportunity to edit various financial settings for that budget. This guide provides additional information on changing those settings and addresses common questions from our customers.

    During the budget creation process, you will have the opportunity to provide the following financial settings:

    • Opening bank balance
    • Overdraft rates
    • Credit rates

    You may also want to edit certain financial settings after your budget has been created, like your interest rate changes, or adding Opening GST for the first month of your financial year.

    These financial settings can be viewed and edited after the budget has been created by clicking on the Opening Balance button at the bottom of the Cashflow screen.

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    Opening Bank Balance


    Your Opening Balance is your bank balance at the start of your financial year. If you have recorded your previous financial year’s transactions in Cashmanager RURAL then the software will already know what your Opening Balance is.

    Why is my opening bank balance greyed out?

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    The Opening Balance will automatically populate with the closing balance of your previous financial year.

    It will appear as a ‘greyed out’ or non-editable field when you create a budget for the current financial year.

    If the opening bank balance is correct, edit the remaining fields and click Next to continue creating your budget.

    Why is my opening bank balance blank?

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    The Opening Balance will automatically populate with the closing balance of your previous financial year.

    It will appear as a blank field if there is no data for it to use. This may happen for several reasons:

    You are setting up Cashmanager RURAL for the first time and there are no previous financial years
    There are two financial years currently open in your database
    The budget is being created for a future financial year.

    Opening GST


    Opening GST is the GST that you will pay or receive as a refund in the first month of your current financial year. It relates to the last GST period of the previous financial year and therefore bridges financial years.

    For example, Joe has a dairy farm and the first day of his financial year is 1 June. His Opening GST, which is due in June, refers back to April/May.

    Adding Opening GST is a manual process and it does not appear with other financial setting information when creating a new budget. It will need to be added each time that you create a new budget.

    Tip: This is an important step in creating a budget as it can have a significant impact on the Closing (Bank) Balance!

    Once your new budget has been created, follow these steps to add Opening GST.

    Step 1: View budget or actual data to work out what amount to add to your new budget as Opening GST. You will need to view actual data if your budget is for the current financial year and budget data if it is for a future financial year.

    How do I view the data?


    There are a few ways that you can view this data, depending on your personal preferences.
    From the Cashflow screen, click Change View. You can choose to:

    1. View actual or budget data at the same time as your new budget by selecting Advanced View. Your new budget will display on Line One and you will need to select the appropriate actual or budget data, and financial year, to display on Line Two.

      • This has the advantage of allowing you to edit your new budget without having to change screens.
    2. View actual data for the year to date by selecting Transactions (Actual Cashflow) and the current financial year.

      • You will need to write down the information you need and then return to your new budget to edit it.
    3. View budget data for this, or a previous, financial year by selecting View/Edit Budget. You will then need to select the appropriate budget and financial year to view.
      You will need to write down the information you need and then return to your new budget to edit it.

    What data do I need?

    This will vary depending on whether your budget is for the current financial year or a future one. Let’s look at a few different scenarios.

    Budget is for the current financial year


    Scenario 1: Joe has a dairy farm and decides to create a scenario budget to see what would happen if he changes his expenditure on a number of items part-way through his 2015/16 financial year. He uses actual data for the year-to-date and will need to enter data for the rest of the budget as he works through each line item. Before he edits his budget, he will enter his Opening GST.

    Joe looks at GST:General on his new budget and sees that there is no GST data showing against his first month.

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    Joe wants his new budget to be as accurate as possible so he changes the view on his new budget to also see his actual data for 2016 on Line Two.

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    To do this, he clicks on the Change View button from the toolbar and selects Advanced View.
    Now he can choose what to view on Line One and compare to on Line Two.

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    Joe sees that the actual Opening GST amount for his 2015/16 financial year was -$9,206 and he can now use this information to update his new budget.

    Budget is for a different financial year

    Scenario 1: Joe decides to extend his main budget for the next financial year of 2016/17.
    Tip: He would also follow these steps to create a ‘what if’ budget for the next financial year.

    Joe looks at GST:General on his new budget and sees that there is no GST data showing against his first month.

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    Joe will need to base his Opening GST on his budget data for the previous financial year. He changes the view on his new budget to see his Main Budget for 2016 on Line Two. Change View -> Advanced View -> Line 2 -> Main budget 2016

    Tip: He chooses his active Main 2016 budget (rather than his “Main 2016 Original”) because he has been updating it through the year and wants the most accurate prediction of his farm’s finances.

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    Viewing Joe’s financial data this way means that:

    • Line One is showing data for June 2016 - May 2017 and period end data for Apr/May 2017.
    • Line Two is showing data for June 2015 - May 2016 and period end data for Apr/May 2016.

    Joe looks at the Period End data for 2015/16 on Line Two and sees that it is -$14,300. This is the amount that he will use as his Opening GST for 2016/17.

    Scenario 2: Joe creates a scenario budget based on having acquired a neighbouring parcel of land and additional livestock to increase his milk production. He sets the budget several years in the future and will need to either guess the Opening GST or leave it blank.

    Step 2: Click on the Opening Balance button at the bottom of the Cashflow screen.

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    Step 3: Edit Opening GST and click OK.

    Tip: If the figure that you are copying appears in brackets, i.e. (9,206), this is a debit amount and is GST to pay. When you enter this into the financial settings you will need to put a - sign in front of it e.g -9,206.

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    Overdraft and Credit Rates


    Overdraft and credit rates can be set during budget creation and also edited as required for both budgets and actual data. These rates must be set for each budget if you choose to auto-calculate your interest rates.

    Tip: Entering these rates will change your closing balances.
    Tip: Interest can be viewed on Cashflow under Interest & Rent.

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    Follow these steps to set up or edit your overdraft and credit rates. To help illustrate the steps, we’ll watch Farmer Joe work through them as he creates a scenario budget for the next financial year.

    Step 1: Enter your Overdraft Rate and Credit Rate while creating your budget.

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    Joe enters his Opening Balance, an Overdraft Rate of 8.5%, and a Credit Rate of 1.5%. He leaves the Credit Threshold at $0.00 as his bank does not require a minimum balance in order for him to earn interest on his account.

    Alternatively, Joe could wait until his budget was created and then click on the Opening Balance button at the bottom of the Cashflow screen; this will pop-up a screen that will allow him to edit the financial settings for his budget.

    Step 2: Turn on the tool that will auto-calculate Overdraft and Credit rates using the percentages that you have just set.

    1. Click on Setup at the top of the Cashflow screen and then select Codes.

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    1. Click on the (+) sign next to Interest & Rent in order to expand this section.
    2. Select Overdraft Interest (or Loan Interest) and then click Edit.

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    1. This will bring up the “Setup Code” screen for Overdraft Interest. Tick the box at the bottom that says OD Interest and then click OK.

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    Tip: Joe can choose to calculate Overdraft Interest for either his bank overdraft or for any loan or mortgage interest he has. The software is unable to calculate this for both. If OD Interest is ticked for more than one code, an error message will appear and OD Interest must be unticked on one of the codes in order to proceed.

    1. Select Income Interest and then click Edit.
    2. This will bring up the “Setup Code” screen for Overdraft Interest. Tick the box at the bottom that says Credit Interest and then click OK.

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    1. Click OK on the “Setup Codes” screen to return to your budget.

    This is Joe’s budget and balances before he turns on the auto-calculate tool for his Overdraft and Credit rates. At this point, the interest rates that he has set for his budget are displayed as a General line of interest.

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    This is Joe’s budget and balances after he turns on the auto-calculate tool for his Overdraft and Credit rates. There are now lines of Overdraft and Income interest displayed (and his General interest line is empty).

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