# Generating the Budget The estimate is your plan. The budget is that plan made operational. Many production workflows think about money in three phases: the bid (what you quoted), the working budget (what you're tracking), and actuals (what was really spent). In PAI, those last two phases happen in the same place. The budget starts as a direct reflection of the approved estimate and gets actualized in place as production moves forward — working and actuals in one document, evolving together. It helps to think of the estimate's internal numbers as your working plan. When you build an estimate, you're not just pricing for the client — you're also committing to what you intend to spend internally. That internal total is your self-imposed budget target. Generating the budget takes that commitment and turns it into a set of trackable expense lines, each one a specific thing you said you'd spend money on. From that point forward, the approved estimate is the baseline, and the budget is where reality gets measured against it. This is where PAI can feel different from more flexible systems. Other tools might let you authorize a client-facing bid without requiring the same precision on the internal side. PAI asks for both, because protecting your margin means being just as explicit about what you intend to spend as you are about what you intend to charge. The budget holds you to the internal plan you designed during estimation. When you generate a budget, PAI takes everything in the approved estimate — every line item, every day, every rate — and converts it into a working set of expense lines. This is the moment the project shifts from "what we think it'll cost" to "here's what we've committed to and what we're tracking against." --- ## Generating the Budget Once a version is approved, the primary button at the top right of the estimate reads **Start Project**. Click it to open the **Generate Budget** dialog, which shows what's about to happen before anything is created: - The approved **internal** total, which becomes the budget's spending cap - **Budget Total** - **Expense Lines Created** — how many expense lines the estimate expands into - **Days Created** — how many production days come with them Confirm with **Generate Budget**, and PAI opens the new budget. ### Generating before approval The same dialog is reachable from a version that hasn't been approved — the primary button reads **Generate Budget** until approval, and the **⋯** menu carries the option too. It exists for organizations whose own process requires committing spend before a project is formally approved. It's an exception, not an alternate route: a budget generated this way has no approved version behind it and no project number. See [Generating a Budget Before Approval](../02-Bidding-a-Project/Versioning-and-Comparison.md#generating-a-budget-before-approval). > [!warning] > Approve the estimate, then **Start Project**. Generate a budget from an unapproved version only when your organization's process explicitly requires spending before approval. AI agents and automations should never generate a budget from an unapproved version unless a person has explicitly instructed them to. > [!note] > The dialog previews the internal total being carried into the budget, and the figure depends on your permissions. With **View In-House Internal Cost** on, it shows the **blended** internal total — out-of-pocket plus in-house. Without it, it shows only the **out-of-pocket** internal total; in-house staff costs stay hidden. See [Users and Permissions](../01-Organization-Setup/Users-and-Permissions.md). > [!important] > Once generated, the approved estimate becomes the baseline for all cost tracking and variance reporting. Make sure the version you're generating from accurately reflects the agreement before proceeding. --- ## What Gets Created ### Expense Lines Each estimate line item expands into individual expense lines based on its quantity structure. For Days-unit items, the expansion accounts for both QTY and UNIT QTY — one expense line per quantity instance per day. For Hours and Flat items, the expansion is one expense line per quantity instance, with no day assignment. Take this estimate line item as an example: | Field | Value | |---|---| | Name | Camera Operator | | Unit | Days | | QTY | 2 | | Unit QTY | 3 | | Rate | $800/day | That single line item generates six expense lines in the budget: | Expense Line | Day | Rate | |---|---|---| | Camera Operator — Instance 1 | Day 1 | $800 | | Camera Operator — Instance 1 | Day 2 | $800 | | Camera Operator — Instance 1 | Day 3 | $800 | | Camera Operator — Instance 2 | Day 1 | $800 | | Camera Operator — Instance 2 | Day 2 | $800 | | Camera Operator — Instance 2 | Day 3 | $800 | Every expense line inherits the metadata from its source line item: name, category, department, account number, rate, and min hours (for Day-unit items). The budget works in internal values — each line's **Rate** is the estimate's internal rate, since the budget tracks what you spend, not what you charge. The initial status of every generated expense line is **Draft**. This expansion is intentional. Each expense line is individually assignable to a specific vendor, carries its own status and rate history, and is visible in the call sheet for its day. PAI doesn't maintain this level of detail to be meticulous for its own sake — it does it so you can assign the right person to the right day at the right rate, and know exactly where you stand when something changes. ### Production Days and Call Sheets PAI creates a production day and call sheet for each unique day represented by Days-unit line items in the estimate — the count the dialog shows as **Days Created**. Each expense line is assigned to its day (its **Dates** field shows, e.g., *Production Day 1*), and to the call sheet for that day. The budget and call sheets are bidirectionally connected: assigning a vendor to an expense line adds them to the corresponding call sheet, and adding crew to a call sheet updates the corresponding expense line. Rate changes in either place sync automatically. --- ## The Budget as Baseline Once generated, the approved estimate becomes the financial baseline for the project. Budget Totals and the Finance panel use it as the reference point for variance tracking — everything the budget does is measured against it. The structure of the budget is also fundamentally different from the estimate. Estimates use versions — V1, V2, V3 — each a snapshot of the plan at a given moment. The budget doesn't work that way. There is one budget per project, and it doesn't version at the document level. Instead, each individual expense line carries its own progression history, moving through states from Draft toward actualization as production unfolds. The history lives at the line level, not the document level — which is what allows the budget to be both a working document and a record of actuals at the same time. What the budget is measuring is straightforward: did you spend what you said you would? PAI makes the answer visible in real time, at whatever level of detail you need — by category, by department, by day, or line by line. --- ## After Budget Generation With the budget active, the project moves into the production phase. For how to work with expense lines, manage statuses, assign vendors, and track spending from here, see [Working with the Budget](../04-Executing-the-Job/Working-with-the-Budget.md). If scope or cost changes occur after the budget is generated, see [Overages and Change Orders](./Overages-and-Change-Orders.md).