What is funds reservation in SAP PSM-FM - Funds Management?

SAP Term: funds reservation

• Component: PSM-FM

• Component Name: Funds Management

• Description: The entry of expected costs in . A funds reservation can be used to reserve portions of the budget early, even if you do not yet know specifically what the budget will be used for or the exact timing. The funds reservation is a preliminary stage for funds precommitments and funds commitments.

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• Key Concepts: 
   Funds reservation is a feature of SAP Funds Management (PSM-FM) that allows users to reserve funds for a specific purpose. This ensures that the funds are available when needed and prevents them from being used for other purposes. The funds reservation feature also allows users to track the status of their reservations and view the details of each reservation. 
  
  How to use it: 
   To use the funds reservation feature, users must first create a reservation in the system. This can be done by entering the details of the reservation, such as the amount of funds to be reserved, the purpose of the reservation, and any other relevant information. Once the reservation is created, users can then view and manage their reservations in the system. 
  
  Tips & Tricks: 
   It is important to note that funds reservations are not permanent and can be changed or canceled at any time. Additionally, users should be aware that funds reservations are not automatically released when they are no longer needed. Users must manually release the reservations in order for them to be available for other purposes. 
  
  Related Information: 
   Funds reservations are closely related to budgeting in SAP Funds Management (PSM-FM). Budgeting allows users to plan and manage their financial resources by setting limits on how much money can be spent on certain activities or projects. By combining budgeting with funds reservations, users can ensure that their financial resources are being used efficiently and effectively.