What is 'top down budgeting' in SAP PA-CM - Compensation Management?

top down budgeting - Overview

• Component: PA-CM

• Component Name: Compensation Management

• Description: A budget amount is determined by the board and this amount has to be distributed to all organizational units below. Each budget unit receives a fraction of this original value.

top down budgeting - Details

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  Key Concepts: 
  Top down budgeting is a budgeting method used in SAP's PA-CM Compensation Management component. It is a process of allocating a predetermined budget to each department or cost center in an organization. This budget is then divided among the various activities and projects within the department or cost center. This method of budgeting allows for greater control over the budget and helps to ensure that resources are allocated in an efficient manner. 
  
  How to use it: 
  In order to use top down budgeting in SAP's PA-CM Compensation Management component, the user must first define the budget for each department or cost center. This can be done by entering the total amount of money allocated for each department or cost center into the system. Once this is done, the user can then allocate the budget among the various activities and projects within the department or cost center. The user can also set up rules and restrictions on how the budget is allocated, such as setting a maximum amount that can be allocated to any one activity or project. 
  
  Tips & Tricks: 
  When using top down budgeting in SAP's PA-CM Compensation Management component, it is important to ensure that all activities and projects are properly accounted for. This will help to ensure that resources are allocated in an efficient manner and that no activity or