16.3. Allocating Costs to Resources

The operation of allocating costs to resources is useful when analysing resource profitability. The allocation operation has the following properties:

• is done by the persons in charge with resource management (especially cars, equipment);

• is done after registering the primary (transactional) documents;

• is done with the purpose of obtaining profitability analyses for the resources;

• has different analysis dimensions than the ones used by primary documents;

In order to allocate costs to resources, you first need to establish the necessary analysis dimensions. These are cost categories, types and sources.

Categories and Types

Cost categories and types are managerial analysis dimensions, independent from the detail levels used by the procurement or accounting departments.

Categories and types are defined in the Resource Cost Setup window, located in the Fleet Management -> FM Setup menu. As a structure, these offer two hierarchy classification levels:

• Level I - Cost-Resource Categories

• Level II - Cost-Resource Types

The cost categories and types are defined by the desired cost analysis (comparison between cars/resources, brands, etc.).

Examples:

The categories will be placed on the report's lines based on the Profit & Loss analysis perspective.

Cost Sources

Cost sources represent the causes that have led to the occurrence of the respective costs, from a management perspective. From the way the expenses are aggregated into the system we can distinguish the following areas that represent potential costs which need to be allocated to resources:

• Unstockable:

  • the records registered via the vendor invoices and their respective lines - these represent all the expenses that come with a vendor invoice and are directed towards a certain (or multiple) resource(s);

  • the records registered by entering payments as lines on the cash journal or of the bank statement, via direct operations with Charges;

  • the records registered by generating depreciation rates in the case of fixed assets resources;

  • for the unstockable expenses, you start from the premise that the respective documents have not been allocated by the time of their registration (for operating and responsibility reasons). The allocation operation is done after the documents have been operated by the person (role) responsible with their verification, approval and allocation.

• Stockable:

  • the records registered via Internal Use Inventories and their respective lines - these represent all the internal expenses obtained through internal consumptions registered by the handlers;

  • for stockable expenses, you should assume that the respective documents have been allocated by the time of their registration, by indicating the asset at Inventory Use Inventory level.

You can use the cost sources to define the events that have led to the respective costs' appearance, so as to subsequently be able to analyse these events.

The sources can be defined in the Resource Cost Source window, located in the Fleet Management -> Setup menu.

Examples:

• Major, minor, planned, accidental revisions;

• Capital Repairs;

• Accidents;

• Current expenses, etc.

Allocating Invoices or Payments

The allocating operation involves taking lines from vendor invoices, cash registers or bank statements and associating them with a resource, at the same time indicating the analysis dimensions described above.

The Cost Allocation window, located in the Fleet Management menu is used to allocate the vendor invoices or payments to resources The following fields are available:

• Document No, Document Type

• Allocation Date - date used for auditing;

  • Period - the accounting period according to the allocated costs analysis;

    • note: you can allocate a document with the Transaction Date in March to the costs corresponding to February;

• Resource Cost Source - causes that have led to the occurrence of the respective costs;

Reference section:

• Base Document Type - allocated document type. Depending on the selection the source the allocated document can be selected in the respective field:

  • Invoice

  • Bank Statement

  • Payment

  • Cash Journal

• Total General, Total Lines

• Total Allocated Amount

Status section:

• Document Status - indicates the current status for the document: "Drafted" (initial document status), "Complete", "Voided";

• Document Action - is used to manage the statuses for the resource allocation document:

  • "Complete" - generates the document effects within the system (cost - resource allocation);

  • "Void" - cancels the document effects within the system;

• Processed (system maintained) - indicates that the document has generated its effects within the system. A processed document cannot be deleted or edited;

The Allocation Details tab is used to select the invoice, cash register or bank statement lines or the payments that will be allocated. Depending on the Base Document Type selection, the following fields are available:

• Invoice Line, Cash Line, Statement Line, Payment - allocated document line;

• Net Amount, Total Amount - amounts taken from the base document line;

  • note: for payments the amounts will be displayed with opposite sign;

• Allocated Amount - to be filled in by the user with the desired amount; this can be whole or partial:

  • leave the whole amount if the entire sum is allocated on the same date and at the same index;

  • enter a partial amount if the sum is allocated on multiple dates and at multiple indexes.

The Allocation tab is used to add the resource to which the line is allocated. The following fields are available:

• Resource - that the allocation is done to;

• Index - enter the index (km) - useful for the Daily Equipment Activity Report and other similar reports;

• Res. Cost Categ. and Res. Cost. Type - selected according to the respective allocation;

• Allocated Amount - whole or partial, accordingly;

• Quantity Allocated - manual declaration.

Available validations:

• The accounting period must contain the accounting date of the invoice , even when the allocation date belongs to a different period;

• The sums to be allocated from the invoice line level = total allocated amount on superior level.

Internal Use Inventory Allocation

For the direct allocations through internal use inventories, the following fields found in the Reference section, Internal Use Line tab, Internal Inventory Use window, are used:

• Res. Cost Categ.;

• Res. Cost. Type;

• Resource Cost Source;

These fields will only appear and become mandatory if you have selected a resource that is linked to an asset in the Resource field. This asset will automatically be entered in the corresponding field in the Reference section.

In order to complete the allocation, use the Allocate Inventory Costs process. Before running the process you can specify the following parameters:

• Organization, Warehouse, Document Type, Document No (contains sequence; e.g. %200% displays what contains 200) - selection filters for the internal use inventory documents used in the allocation process;

• Period (month, mandatory) - only Internal Use Inventory documents with the account date within this period will be processed;

• Dest Document Type, Document Action - determines the document type and status for the generated resource-cost allocation documents.

The result of the process will be registered as "Cost Allocation" documents: one for each Internal Use Inventory and Resource Cost Source type on the lines, because the information is taken from the lines of the Internal Use Inventory (i.e. there can be different sources on the same document), whereas, on the allocation document, the source is at allocation document level.

Important: You must first transfer the Inventory document before allocating it to a resource!

Depreciation Rate Allocation

The Depreciation Cost Allocation process is used to allocate depreciation rates to resources. Before running the process you can specify the following parameters:

• Organization (optional) - determines which fixed assets will be used in the allocation process;

• Period (month, mandatory) - only the depreciation rates whose account dates are inside this period will be processed;

• Resource Cost Source, Type and Category - dimensions used for analysis;

• est Document Type, Document Action - determines the document type and status for the generated resource-cost allocation documents

The depreciation rates taken into account for the allocation process are those corresponding to the main accounting schema (the one indicated at Tenant level).

The allocation is done on a 1:1 basis: one fixed asset for one resource, when the resource belongs, from an accounting perspective, to the fixed asset category. The product derived from defining the resource must be found in the definition of the fixed asset.

The result of the process will be registered as "Cost Allocation" documents: one document for each Resource Cost Source type.

Reports

The Resource-Cost Allocation Report report presents, in a centralized format, the costs allocated on resources. Depending on the corresponding print format, the grouping will be done at one of the following levels:

• Resource Cost Source;

• Resource Cost Category or Type;

• Mixed.

The report can be found in the Fleet Management menu.

The data come from the Cost Allocation Report window. The uses the following selection filters:

• Period (month, mandatory)

• Resource Type (optional)

• Resource (optional)

• Res. Cost Categ.

• Res. Cost. Type

• MOC Category (optional)

• Mean of Conveyance (optional) - the report will be grouped by means of conveyance;