BUDGET AGAIN URGENT

Question

Hi All,
Plz help urgent abount budget. How to accounting? I did the following steps but the program does not give me warn or blocked my transactions.
1. I activated budget from Administration --> Initialization --> General Setting --> Budget Tab then click the parameter on that.
2. Financials --> Budget Setup --> Budget scenario. I use default scenario.
3. Budget Distribution method I use Equal as Default
4. In Budget I put the amount in certain account. I don't know should be put on debit side or credit side.
5. I tried to craete PO with amount exceed the budget ( I put budget in account Account Payable). I expect that my entry will be blocked by system, but is not happen. the transaction accepted by system. And then tried to create GR PO, again system does not reject my transaction. Why ??
6. Then I put budget in petty cash account in debit side. I tried to debit this account with amount exceed the budget. Again the system accepted this transaction completely.
I am confuse .. is there any incomplete in my setting? 
Please help and TIA
regards,
Bambang

Answer 1

Hi there
Budgets are normally set for P&L Items such as
Sales  you might have 100,000 dollars budget for Sales
Exenses
you might have 500.00 against Accounting Fees in Expenses or you might have 1000.00 in your Advertising Account Code
but you would normally not budget against any balance sheet items.
Marilyn