Before giving you some details about our last updates on the budget management process for private equity deals, I should explain what is the “working version” of the Bid Budget on inPrivate Systems. Our users can add a Bid Budget for a specific deal, adding “rows” to a specific version. Each row, upon the completion of the process, will become a real contract with an advisor, and it contains the type of the service (Financial Advisory, Technical Avisory, etc), the name of the Advisor and the budgeted retainer and success fees.
When the budget is approved by the board, the system freezes this version, but the user can open a “working version” of the Bid Budget based on the last approved version. This version is useful because users can “adjust” the budget values within the constraints imposed by the board.*
The main constraints are to not exceed the overall amounts approved by the boards, neither the total retainer, nor the retainer plus the success amount.
Other constraints could be on the amounts for each row of the bid budget; for example, if the amount approved for a single Advisory service is greater than a specified maximum amount, the user can't change the name of the consultant and he can't input a greater amount.
Users can't modify the budget row if the relative contract is signed. If it's necessary to force a new update on the budget, they should restart the workflow of the contract, so the the approval process restarts for that contract.
Another improvement is that the entire budget now has its own workflow; when the users marks the budget as “approved from the board”, the entire budget is sent through the system to a member of the board, to let him certify that it’s the right version that it was effectively approved by the board.
If you’re interested in a demo or in a Trial Version of inPrivate Systems, please request it here.
(*) Usually the board approves also a buffer amount to be used for later adjustments of the budget.