Creating and Managing Budgets

A budget lets you plan how much money your organization expects to receive and spend during a fiscal year. Once you create a budget, NP Ledger can compare it to your actual transactions so you can see whether you're on track.

Your board, funders, and auditors expect you to have a budget. More importantly, comparing your budget to actual spending is how you catch problems early, like a program that's burning through its grant faster than expected, or revenue that's falling behind projections. The Budget vs. Actual report puts this comparison in front of you automatically.

• At least one fiscal year set up (see Setting Up Your First Fiscal Year)
• Your chart of accounts should include the revenue and expense accounts you want to budget for (see Chart of Accounts)
• Budgets require a Standard plan or higher

Creating a budget

1. Go to Accounting > Budgets (in the sidebar).
2. Click "New Budget."
3. Enter a name for the budget, such as "FY2026 Operating Budget" or "Youth Program Grant Budget."
4. Select the fiscal year this budget covers.
5. Optionally set an approved date if your board has already approved the budget.
6. Optionally copy line items from an existing budget by selecting it from the Copy line items from dropdown. This saves time if your budget is similar to last year's.
7. Click "Create Budget." You'll be taken to the budget editor to add line items.

Entering budget amounts

After you create a budget, the Budget Line Items editor lists every revenue and expense account from your chart of accounts as its own row. You build the budget by filling in amounts on the rows you care about.

1. Find the account you want to budget for in the list.
2. Enter the annual amount for that account in the Annual Amount column.
3. Add notes in the Notes column if you want to record the reasoning behind the amount.
4. Repeat for each account you want to budget. Accounts you leave blank simply aren't budgeted.

Your entries save automatically as you type: there's no Save button for line items and no page reload. A running Revenue Budget, Expense Budget, and Net total updates at the bottom of the list as you go. To clear an amount you've entered, click the remove (×) button on that row.

Tip: If you copied amounts from a previous budget when you created this one, they're already filled in. Adjust or clear them as needed.

Budgeting for a specific fund, program, or grant

The main Budget Line Items grid above sets org-wide amounts for each account. When you need to budget an account for one specific fund, program, or project, such as a grant-funded salary line, use the Program & Grant-Scoped Line Items section below the main grid.

A scoped line appears in the Budget vs. Actual report only when you filter that report by the matching fund, program, or project. That makes it the right tool for tracking a grant's budget separately from your overall budget.

1. Scroll to "Program & Grant-Scoped Line Items" below the main budget grid.
2. Under "Add a scoped line item," choose the Account you want to budget.
3. Choose a Fund, Program, and/or Project to scope the line to.
4. Enter the Annual Amount (and Notes, if you like), then click Add line item.

The new line appears in the list above, tagged with the fund, program, or project you chose. Amounts and notes there save automatically as you edit them, just like the main grid. To remove a scoped line, click the remove (×) button on its row.

Making a budget active

Only one budget can be active per fiscal year. The active budget is the one used in the Budget vs. Actual report.

1. Open the budget you want to activate.
2. Check the "Active" checkbox in the budget form.
3. Save. If another budget was active for this fiscal year, it will automatically be deactivated.

Editing and deleting budgets

• To edit, click the budget name in the list, then modify any fields or line items.
• To delete, click Delete on the budget's row. You'll be asked to confirm.

Important: Deleting a budget removes all its line items. If you just want to stop using a budget in reports, deactivate it instead of deleting it.

• Your budget appears in the budget list with the correct fiscal year and status (Active or Draft)
• Line items show the accounts and amounts you intended
• The Budget vs. Actual report shows your budgeted amounts alongside actual transactions

• Forgetting to activate the budget: A draft budget won't appear in the Budget vs. Actual report. Make sure to check the Active box.
• Budgeting the wrong fiscal year: If your budget and transactions are in different fiscal years, the Budget vs. Actual report will show zero actuals. Double-check the fiscal year selection.

Accountant note: Budgets are entered at the account level (one annual amount per revenue or expense account), and the Budget vs. Actual report compares these against actuals. This supports the functional expense reporting expected under ASU 2016-14 when your expense accounts align with your functional categories.