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

SAP Term: top down budgeting

• 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.

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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 project is overlooked. Additionally, it is important to review the budget periodically to ensure that it is still appropriate for the current needs of the organization. 
  
  Related Information: 
  For more information on top down budgeting in SAP's PA-CM Compensation Management component, please refer to SAP's official documentation on the topic. Additionally, there are many online resources available which provide further information on this topic, such as tutorials and videos.