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1. Tracking department budgets within a larger company-wide budget can be a complex process, especially when using shared general ledger (GL) accounts across departments. Fortunately, QuickBooks Online (QBO) offers several features that can help streamline this task. Here’s a step-by-step approach to effectively manage and communicate departmental budgets:

   Step 1: Set Up Your Initial Budget Framework

   1. Define the Total Budget:

   2. Start by defining the overall company budget. This includes allocating specific percentages of total spend to categories like Meals and Entertainment.

   3. Use Classes for High-Level Branch Budgeting:

   4. Since you’re already using Classes for high-level budgeting, continue this practice to track larger categories like branches or divisions. This will allow you to segment financial data at a macro level.

   Step 2: Implement Department-Based Tracking

   1. Utilize QBO’s Class Feature for Departments:

   2. While QBO Classes can be used for high-level divisions, consider using this feature further for department tracking if possible. Assign each transaction to a class that represents both its branch and department (e.g., “Branch1-DeptA”).

   3. Explore Location Tracking:

   4. If feasible, use Location tracking for another layer of segmentation. This can be useful if departments operate out of different physical locations.

   5. Use Projects for Sub-Budgeting:

   6. Use QBO’s Projects feature to create sub-budgets within departments. This is especially useful if you need detailed tracking of expenses against specific departmental initiatives or activities.

   Step 3: Navigate Shared GL Accounts

   1. Splitting Transactions:
   2. When GL accounts are shared across departments and transactions need splitting, use the ‘split transaction’ feature in QBO. While you identified challenges with allocating splits directly in transactions using Departments or Tags, splitting through manual entry might be necessary.

   3. Example: When recording a meal expense, split the transaction amount across the relevant departments by line item.

   4. Custom Fields/TAGS:

   5. Although you mentioned that you cannot split transactions with Tags, be aware that custom tags or fields can be utilized creatively for additional identification. For instance, use tags to denote “Shared Expense” or specific departments for manual tracking.

   Step 4: Monitor and Report

   1. Budget Vs. Actuals Report:
   2. Regularly review Budget vs. Actuals reports available in QBO. Customize these reports by Class or Location

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