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Administrator Guide
Last Updated: 2025-10-31
Create Spend Categories

Create Spend Categories

Security:
Set Up: Spend Categories
 domain in the Common Financial Management functional area.
You can create spend categories to classify:
  • Assets.
  • Expense items.
  • Inventory items.
  • Purchase items.
  • Supplier catalog items.
Spend categories drive the accounting that connects the asset, item, or service to the appropriate ledger account. You can define your own categories or use these standards:
  • United Nations Standard Products and Services Code (UNSPSC)
  • National Institute of Governmental Purchasings (NIGP)
You can also combine your own spend categories and map them to standard commodity and services codes.
  1. Access the
    Maintain Spend Categories
     task.
  2. (Optional) Select the
    Import Existing Spend Category
     option to add existing spend categories to spend category hierarchies.
  3. As you complete the
    Spend Category Detail
     section, consider:
    Option Description
    Commodity Detail
    Enter an alternate reference name, which users can use to search for the spend category.
    When you already associate spend categories to commodity codes on the
    Create Commodity Code
     and
    Edit Commodity Code
     tasks, leave this field blank.
    Spend Category Display
    Select an option to determine how your spend category hierarchies and commodity codes display in Workday.
    The option you select prints on purchase orders and supplier contracts.
    Spend Category Usage
    Select from these usage types:
    • Ad Hoc Payment
      : Include other usage types to use this spend category for expenses, procurement, and supplier invoices.
    • Expense
      : Workers use these spend categories in spend authorization and expense report lines.
    • Procurement
       - Use for:
      • Requisitions.
      • Purchase orders.
      • Receipts.
      • Returns.
      • Supplier contracts.
      • Purchase items.
      • Leased assets.
      Workday automatically includes the
      Supplier Invoice
       spend category usage after you save the spend category with
      Procurement
       usage.
    • Supplier Invoice
       - Use for:
      • Supplier invoices
      • Supplier invoice adjustments
      • Recurring supplier invoices
      • Leased asset invoices
    Inactive
    Select to prevent the spend category from displaying in business documents and spend category prompts.
    You can use an inactive spend category in business documents by entering its name in prompts. Inactivating a spend category doesn't change historical data or impact previous transactions.
    Requisition Fulfillment Source
    Enable this field by selecting
    Procurement
     in the
    Spend Category Usage
     prompt.
    Select to populate
    Purchase Order
     or
    Inventory
     to the requisition fulfillment source when creating requisitions for this spend category.
    The
    Inventory
     value only displays when you select
    Stock Items
     in the
    Inventory Tracking
     section.
    Classification
    Select Goods or Services to classify spend categories as either goods or services. Use this for tax reporting and tax defaulting rules.
    Worktags
    Set up related worktags for this object using the related worktag types that you configure on the
    Maintain Related Worktag Usage
     task. Workday automatically populates transactions with the values in the
    Default Worktag
     column when you select the object on the transaction.
  4. As you complete the
    Tax and Additional Charges
     section, consider:
    Option Description
    Default Tax Applicability
    Specify how you apply tax to transactions for goods and services in this spend category. You can also define item tax rules to set more detailed tax applicability default behavior. You can then change the default within the transaction.
    Allocate Freight
    Allocate Other Charges
    Select to allocate the freight and other charges from document headers to the lines when you set up the spend category for the allocation.
    These landed costs become part of the cost of procuring a line item. Allocation applies to:
    • Purchase orders.
    • Supplier invoices.
    • Supplier invoice adjustments.
    • Ad hoc payments.
  5. As you complete the
    Asset Tracking
     section, consider:
    Option Description
    Track Items
    Select to enable custodial tracking of assets assigned to this spend category. Track assets to issue assets with this spend category to workers.
    If a trackable spend category also has expense usage, you must manually register the assets you include in expense reports. You can't configure the expense report business process to initiate an asset registration event automatically.
    Intangible
    The option is available when you select
    Track Items
    . Select to define the spend category with the
    Intangible
     spend category default, such as software subscriptions and service rights. Spend categories with the
    Intangible
     attribute must track items.
    You can only create assets defined with the intangible spend category default from contract receipt lines, not directly from purchase orders or supplier invoices.
    You can't select
    Lease
     when you select the
    Intangible
     option.
    Lease
    The option is available when you select
    Track Items
    . Select to designate the spend category for use with financial and operating leased assets. Workday creates assets defined with the
    Lease
     spend category from supplier contract lines.
    You can't select
    Intangible
     when you select the
    Lease
     option.
    Default Asset Class
    Select to assign an asset class to this spend category.
    Configure asset classes on the
    Maintain Asset Classes
     task.
    Default Asset Type
    Select to define an asset property type for this spend category.
    Configure asset types on the
    Maintain Asset Types
    class.
  6. (Inventory only) As you complete the
    Inventory Tracking
     section, consider:
    Option Description
    Stock Items
    Select to enable this spend category to stock items.
    Workday treats items associated with this spend category as inventory items or stockable items.
    A nonstock item is a purchase or supplier item with a spend category that doesn't have the Stock item check box selected.
    Example: An Office Supplies spend category with items like Desk Lamp, or Printer Toner. Office Supplies isn’t marked as Stock Items.
    Inventory Accounting Treatment
    Select the inventory accounting treatment as
    Expense
     or
    Inventory
    .
    • Items with an
      Inventory
       accounting treatment are considered assets at put-away and then expensed when either issued, transferred, or adjusted down.
    • Items with an
      Expense
       accounting treatment are expensed at put-away and track quantity balances from that point forward.
  7. If you connect to supplier websites using punchout, identify all standard commodity code ranges that equate to your spend category in the
    Supplier Link Commodity Code Mapping
     grid.
    When you connect to a supplier website during requisitioning through punchout, the supplier site returns a commodity code. Workday identifies the spend category based on the code range it falls within. Workday also stores this code in the purchase order it generates from the requisition when transmitting the purchase order back to the supplier through XML.
    For purchase orders that don't come from a requisition, you can identify a specific commodity code when sending purchase orders to your suppliers through XML. Specify the same code for
    Range From
     and
    Range To
     fields and check
    Use on PO
    .
  8. Enable alternate item identifier types for spend categories to capture item identifiers for purchase items, such as supplier part number or manufacturer part number.
  • (Optional) Create spend category hierarchies and spend category security segments.
  • Inactivate spend categories that are no longer in use.