How to Create a Budget.

What Is a Budget?

A budget in Reach Reporting is a fixed financial plan that represents your goals and expectations for a defined period — typically a fiscal year. Unlike a forecast, a budget does not automatically update with new actuals as the year progresses. It serves as a stable baseline you can measure performance against throughout the year.

Reach Reporting supports three-way budgeting, meaning it automatically integrates your:

Profit & Loss (P&L)
Balance Sheet
Cash Flow Statement

This means any change you make to your P&L — such as adjusting revenue or expenses — automatically flows through to the Balance Sheet and Cash Flow Statement with no manual formulas required.

For a full overview of how the three-way integration works, see Mastering Budgeting with Reach Reporting's 3-Way Planning Tool.

Budget vs. Forecast: Key Differences

Understanding the difference between a budget and a forecast helps you use each tool effectively.

To learn more about the key differences and for more information on creating a forecast, see Forecast vs. Budget: Key Differences and How to Create a Forecast.

Before You Begin: Starting Point Options

Use a QBO or Xero Budget
Use an Excel Budget
Build a Budget in Reach Reporting (Budgets PRO)
Duplicate an Existing Budget (Budgets PRO)

Option 1: Use a QBO or Xero Budget

Reach Reporting pulls budgets directly from QuickBooks Online (QBO) and Xero. These budgets are available to use in your metrics and statements without any additional setup inside Reach.

A few important things to know:

QBO and Xero budgets do not appear in the Budgets/Forecasts tab in Reach. They are accessed through column settings in a metric or statement, or set as the default budget in Company Settings.
Reach only pulls the last 3 years of budget data from QBO and Xero.
Budgets are not pulled from QuickBooks Desktop (QBD). If you use QBD, you will need to build your budget in Reach or use an Excel budget instead.

To set a QBO or Xero budget as your default so that all templates using budget data reference it automatically, go to Settings > General Settings and select it as the Default Budget.

To use a QBO or Xero budget in a specific metric or statement, click the gear icon above a column, change the column type to Budget/Forecast, and select the budget you want.

Note: Make sure the time frame of the column matches the budget period in QBO or Xero. For example, if you built a quarterly budget in QBO but display only one month in Reach, the data will be incorrect. If you sync a monthly budget and display a quarter or multi-month range, Reach will handle the calculations.

For more details, see QuickBooks Online Budgets and Xero Integration.

Option 2: Use an Excel Budget

In certain instances, an Excel budget may be preferable to a Budgets Pro budget..

For more information, see Budgets Pro vs Excel Budgets, How to Create an Excel Budget in Reach Reporting, and Excel Class Budget Upload.

Option 3: Build a Budget in Reach Reporting (Budgets PRO)

You can create a full three-way budget directly inside Reach Reporting using Budgets PRO. This gives you access to automated row drivers, Balance Sheet planning, Data Sheet calculations, and Cash Flow automation — all in a familiar spreadsheet environment.

Follow the steps below to create a new Budgets PRO budget:

Step 1: Create a New Budget

Open a company and navigate to Budgets in the left menu.
Click Add New Budget at the top right.
Select the financial statements to include in your budget. To build a full three-way budget, select Profit & Loss, Balance Sheet, and Cash Flow Statement.
Choose a bank account — this will be your balancing account, tracking all money in and out based on your budget assumptions.
Set your budget date range — you can budget up to five fiscal years in advance.
Choose whether to prefill the budget with actuals, another budget, or forecast values — or start from scratch.
- If you prefill, you can apply a growth rate, which will automatically apply to your entire P&L. The Balance Sheet will prefill using the final month's actuals.
- You can choose to exclude deleted accounts, though keep in mind this may affect the prefill of historical data.
Give your budget a name and click Create.

Tip: If you are creating a budget by class or department, or setting up a multi-year budget group, see Budgets by Class and the Multi-Year Budget Creation Guide.

Step 2: Configure Budget Settings

When you first open a new budget, a settings popup will appear automatically. You can return to this at any time by clicking the gear icon at the top of the budget.

Each financial statement includes a grayed-out reference column that pulls in your prefill period data. This column stays visible as a reference point, allowing you to compare your budget values against historical actuals and track variance as you build.

For more information on how reference data works and how to configure it, see Budgeting with Reference Data.

Step 3: Budget the Profit & Loss

Using Row Drivers

To save time, Reach Reporting offers automated row drivers that help project values based on your historical data.

For more information, see Row Drivers in Budgets/Forecasts.

Manual Entry and Formulas

Reach Reporting also gives you full flexibility to enter values manually or use formulas directly in the budget grid — just like a spreadsheet.

To allocate a custom amount equally across months, click the starting cell and use the allocation options at the top tool bar.

You can use relative and absolute references to lock formulas when copying across months by dragging a cell, or right-click to access copy and paste options.

Right-click and add comments to document the reasoning behind your numbers. Comments will be marked with a blue flag, and you can view comment history using the comment icon at the top tool bar.

Display and Navigation Options

Click the arrow icon at the top left to collapse all rows and quickly review group totals, then expand or collapse any group as needed. Totals update automatically whenever budget values change.

Click the eye icon to hide with zero values or unhide all rows, helping you focus on relevant accounts.

To delete an account, click the pencil icon, check the box next to the account, and select Delete.

You can also right-click on a row number to hide/unhide specific rows.

Step 4: Use the Data Sheet for Complex Calculations

The Data Sheet is a built-in spreadsheet environment within your budget that lets you create custom calculations beyond what row drivers can handle.

For more details, see Budget/Forecast Data Sheets.

Step 5: Budget the Balance Sheet

The Balance Sheet in Reach Reporting follows the same driver and manual input options as the P&L, with one important addition.

Carry Forward Driver

All Balance Sheet accounts have the Carry Forward driver enabled by default. This automatically carries the prior month's value forward into each subsequent month. You can override the value for any individual month as needed.

Common Balance Sheet budget entries include:

Fixed asset purchases (for example, adding a $100,000 vehicle in March)
New loans or long-term liabilities (for example, a $200,000 construction equipment loan in February)
Ongoing loan repayments (for example, a $15,000 monthly mortgage payment starting in January)

AR, AP, and Inventory Automation

Click the settings gear icon to configure automated calculations for Accounts Receivable, Accounts Payable, and Inventory. When enabled, the system automatically calculates expected cash inflows and outflows based on your payment terms, removing the need for complex formulas.

For more information about this feature, see Planning for Accounts Receivable, Accounts Payable, and Inventory Turnover.

Step 6: Review the Cash Flow Statement

The Cash Flow Statement in Reach Reporting is fully automated — it updates in real time as you make changes to the P&L and Balance Sheet. Because it is calculated automatically, it is locked to prevent accidental edits.

Here is how the automation works:

Changes to P&L income and expenses flow through automatically to operating activities.
Balance Sheet changes — such as a new loan or asset purchase — flow through to financing or investing activities.
The ending cash balance equals the difference between the starting cash balance and adjustments made for budgeted cash inflows or outflows.

For example, a $200,000 long-term loan recorded on the Balance Sheet in February will appear as a cash inflow under financing activities, and the increase will be reflected in the February ending cash balance.

Option 4: Duplicate an Existing Budget (Budgets Pro)

If you want to reuse an existing budget's structure, customizations, or drivers — for example, when rolling into a new fiscal year — you can duplicate it rather than starting from scratch if it was created using Budgets PRO.

To duplicate a budget, navigate to Budgets, click the gear icon next to the budget you want to duplicate, and select Duplicate. In Advanced Settings, you can adjust the time frame for reference data and choose whether to refresh drivers when the budget is opened.

You can also convert a duplicated budget into a forecast at this stage. See How to Create a Forecast for details.

Set the Budget as Default

Once your budget is complete, set it as the default budget for your company so it flows into your reports and dashboards automatically.

Go to Settings > General Settings.
Select your budget as the Default Budget.

You can also set a budget as default by clicking the gear icon next to the budget in the Budgets/Forecasts list and selecting Set as Default.

Setting a budget as the default will:

Automatically pull the budget into your template reports and dashboards
Allow you to instantly compare budget vs. actuals across your reporting
Sync budget data with all template metrics that reference the default budget

Managing and Reusing Budgets

After saving and closing a budget, you can manage it further by clicking the gear icon next to the budget name in the Budgets/Forecasts list. Options include:

Set a status tag to track progress
Include in the Client Portal to give clients view-only or edit access. For more information on sharing budgets with clients, see Budgets and Forecasts in the Client Portal.
Lock the budget to prevent further changes
Rename the budget
Duplicate the budget

New Account Warning

Whenever you open a budget, Reach Reporting checks for any missing accounts to ensure your Balance Sheet stays in balance. If new accounts have been added to your chart of accounts or if accounts have been deleted since the budget was created, a warning icon will appear at the top of the budget next to the title.

For more information on how to keep your budget aligned with your chart of accounts, see How to Update Your Budget Chart of Accounts.

Using Your Budget in Reports and Dashboards

Once your default budget is set, it is ready to use throughout Reach Reporting:

In any metric or statement, change a column to the Budget/Forecast column type to display your budget data. See Actual vs Budget Column Type for more details on setting up metrics that automatically switch from budget/forecast to actuals as your book month progresses.
The template library includes ready-to-use reports and dashboards designed for budget vs. actual comparisons — select a template and your budget data will populate automatically.
All templates are fully customizable to match your exact reporting needs.

Limitations to Know

You cannot add custom lines to a Budgets PRO budget. The budget is structured to match your chart of accounts exactly. Perform more complex calculations on your data using sheets.
Reach does not support a budget for revenue by client. As a workaround, you can build a separate budget for each client using Budgets PRO or Excel, then select each budget individually in a metric or statement.
QBO and Xero budgets do not appear in the Budgets/Forecasts tab. They are accessed through column settings or Company Settings.
Reach only pulls the last 3 years of past budget data from QBO and Xero.
Budgets are not pulled from QuickBooks Desktop. Use Budgets PRO or an Excel budget instead.
Budgets PRO can only create a budget going forward 5 Fiscal Years or going back to the Last Fiscal Year. For prior years further than the Last Fiscal Year, use an Excel budget.

Troubleshooting

The Balance Sheet is out of balance.

Check for the missing accounts warning icon at the top of the budget. New or deleted accounts may need to be reviewed and mapped. Click the indicator next to the budget title to add any missing accounts. For more information on how to keep your budget aligned with your chart of accounts, see How to Update Your Chart of Accounts.

The cash balance is not calculating correctly.

Ensure that the correct bank account has been selected as the balancing account in budget settings. Also, verify that AR, AP, and Inventory automation settings are configured correctly if those features are in use. For more information about these features, see Planning for Accounts Receivable, Accounts Payable, and Inventory Turnover.

If the business is taking owner draws or distributions during the budget period, those reductions in equity will not be reflected automatically. Reach Reporting auto calculates the Retained Earnings by combining the accumulating new income from the P&L. If draws are not accounted for then the Retained Earnings balance will be overstated, which flows through to an incorrect cash position. To correct this, manually override the Retained Earnings row for the months where draws occur to reflect the expected balance after distributions. See Mastering Budgeting with Reach Reporting's 3-Way Planning Tool for more on how Balance Sheet changes affect the Cash Flow Statement.

You may notice that Undeposited Funds are included in ending cash on the Cash Flow Statement but not in the Balance Sheet. This is because QuickBooks classifies Undeposited Funds as an “Other Current Asset” rather than cash, while still including it in the Cash Flow Statement since it represents money received but not yet deposited (cash in transit). Reach Reporting pulls this data directly from QuickBooks without changing its classification, so both reports follow QuickBooks’ logic, which can result in a difference between ending cash on the Cash Flow Statement and the Balance Sheet when Undeposited

Row driver calculations are not updating.

Drivers do not always refresh automatically. Go to Advanced Settings and trigger a refresh, or use the manual refresh icon in the P&L or Balance Sheet. Make sure to save after refreshing. See Budgeting with Reference Data for more details.

The Annual Target driver with Seasonality is not calculating correctly.

Check for negative values in the prior year data. The seasonality calculation cannot process negative growth rates and will return zero instead. Click into Row Settings > Preview to check for negative values. See Troubleshooting annual Target with Seasonality for more detail.

My budget shows "View Only."

If you are in a classed budget, you will need to change the P&L dropdown to the specific class and update each class individually.

My QBO or Xero budget is not showing in Reach.

QBO and Xero budgets do not appear in the Budgets/Forecasts tab. Access them through the column settings in a metric or statement, or set them as the default budget in Company Settings. If you are not seeing the budget as an option, confirm that it has been created in QBO or Xero and that the company has synced recently.

Best Practices

Use the three-way budget if applicable. Including the Balance Sheet and Cash Flow Statement alongside the P&L gives you a complete picture of your financial position and eliminates the need for manual cash flow modeling.
Duplicate before modifying. If you need to create a new version of an existing budget, always duplicate first to preserve the original.
Set as the budget as default once approved so the budget automatically flows into all template reports and dashboards.
Add comments to document your assumptions, especially for manual overrides, so team members understand the rationale behind budget decisions.
Use the Data Sheet for complex calculations — payroll models, depreciation schedules, or loan amortization — and link the outputs back to the P&L and Balance Sheet rather than entering values directly. See Budget/Forecast Data Sheets for more information.
Duplicate your budget to create a forecast after locking in your annual budget so you can track actuals against plan on a rolling basis throughout the year. See How to Create a Forecast for more information.
Share via the Client Portal to give clients view-only or edit access to the forecast. See Budgets and Forecasts in the Client Portal for more information.

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