Cost Centres

For the purposes of job costing, jobs are broken down into separate tasks. We call these cost centres. Cost centres can represent work done by different trades, field supervision, office overhead, engineering, or whatever you want to track the costs of.

Each time you post a timesheet or an invoice to a job, you are required to select which cost centre to post to. The cost or revenue of that posting will be recorded on the centre you choose. Materials, labour, equipment and subcontract costs are recorded separately. Purchase orders are recorded as committed costs, but convert to actual costs when the purchase order is drawn down by an invoice.

Progress and forecasting is recorded for each centre. The consolidated cost reports consolidate centre forecasts and report them by area and job, thereby forecasting the eventual cost for the entire job or area.

You can also map centres that represent expenses back to the centres that will eventually collect the revenue for those expenses. This allows the G/L Job Revenue Analysis report to determine if you are receiving adequate income for the work you do.

To review cost centres, navigate to [e] Job Costing, then [f] Centre Entry.

Abio displays a list of current centres.

Centre Details

Click on the Details tab to review a centre.

Click on the action field to see a list.

Cost Centre Actions

INQUIRE

This action lets you view, but not change, a cost centre.

ADD

Add a new cost centre to a job’s area.

CHANGE

Change the budget, client coding, and revenue mapping for a cost centre.

DELETE

Delete a cost centre that doesn’t have any invoices or timesheets posted to it.

PRINT

Print, email, or export the cost centre record to excel.

Export

The export utility allows you to copy a set of cost centres from one job to another job. You can use this feature if you’ve customized a set of centres with client coding, or if you want to create new jobs with several areas. Otherwise, it’s simpler to let Abio default the cost centres from the new job by selecting a job type.

When you select the export action, this screen is displayed:

If you select the same from and to job in the same company, you will be prompted to specify which area to copy the centres for, and what area to copy them to.

If you select a new job, you will be prompted to select a range of areas, centres and posting types to copy to the new job.

When you click on the <Apply> button, Abio copies the centres and creates a report informing you which centres were created.

Group

You can create special centres with posting type of ‘G’roup. The consolidated cost reports will display extra totals for each group, that are a sum of the groups below them in the hierarchy. Group centres are appended with zeroes, and centres with more zeroes will group all the centres between them and the next group centre with the same number of zeroes.

When you select the Group action Abio will examine the centres your job has defined. It will compare your centres to the set of standard centres that are defined as grouping centres.

From this it will suggest grouping centres that you may want to add.

Abio will confirm how many grouping centres it added.

History

Use this action to either move a centre to history, or bring a centre back from history.

Override

This action allows you to change the ‘override forecast?’ field. Grant users this action if you want to limit their access to other centre fields.

Print

Print, email or export the current centre record to an excel spreadsheet.

UNAUDITED CHANGE

This action allows you to make changes to the cost fields that Abio uses to track revenue and expenses. Typically only a system administrator would do this. If the numbers match their drilldown, there’s no need to change them.

Cost Centre Fields

Job, Area, Centre

These fields uniquely identify the cost centre.

Description

This displays on reports.

Client Coding

If the job’s client is using different software and wants to rationalize their reports to Abio’s, enter their coding here. Abio will produce reports based on the client coding.

Flags
Override forecast?

Abio automatically forecasts how much each centre will cost to complete, based on how much you’ve spent, how much you’ve budgeted, and how much you’ve completed. If you want the forecasting procedure to ignore this cost centre, set this flag to ‘Y’.

Forecast hours?

You can select whether the forecasting procedure forecasts hours or ignores them.

Restrict?

Set this flag to ‘Y’es if only users with access to restricted information can see this cost centre.

Grouping

These fields allow you to adjust how the consolidated cost reports display.

Quantity Tracking

Quantities are budgeted, forecast and tracked for each type of posting: labour, material, equipment and subcontract.

Identify how you measure the work done in this cost centre. At it’s simplest, you would just budget 100%. The original and current budget would be 100, and the units would be %. Then, when you’re tracking how much work has been done, you would enter 50% if you were half finished.

In the example above we are tracking linear metres, or LM for short. We plan to complete 1,200 linear metres of brickwork, and to date we’ve finished 850 linear meters.

original budget (Quantity)

This field can be modified until such time as the project manager approves the original budget and sets the job’s freeze budget flag. At that point, any changes to the budget are recorded in the current budget field. This lets you know the budget has changed due to a change in scope rather than it just being incorrect.

Current Budget (quantity)

The current budget includes any changes made to the original budget due to change orders or reapportioning budgets between centres. You can manage your budget by using the budget transfer entry screen. In this way you will have an audit trail for each time the budget changes.

Forecast quantity

This field is updated as part of the forecasting process. It doesn’t generally change, unless a centre’s posting type is marked as completed. In that case it is set to the whatever the current budget quantity is at that time.

Quantity To Date

Quantities are how you indicate to Abio how much progress you’ve made on the work represented by each cost centre. Abio then uses that information to forecast costs. These quantities can be entered on the J/C Quantity entry screen. You can also use Abio’s web app when you’re on the job site.

Complete?

Set this flag to ‘Y’ when all work is completed. This will close off this posting type to any further forecasting.

Unit

This is for your own reference, to indicate what the quantities are measuring. Are they cubic feet, man hours, percents? This can be any three letters. You can also standardize units to make things simpler and more consistent. If you do that, users will be able to select the units from a dropdown window.

Costs

When purchase orders, invoices, and timesheets are posted to cost centres, the dollars are accumulated in the centre’s cost fields.

Original Budget (costs)

As with quantities, you also budget the dollar amounts you plan to spend on each posting type. You can manipulate the original budget fields until they are approved by the project manager. At that time, he or she will freeze the budget to prevent any further changes to the original budget.

Current Budget (costs)

Once the original budget is frozen, only the current budget can change. To create even more clarity, use the budget transfer mechanism to create an audit trail for budget changes.

Costs to Date

The costs to date fields are where dollar amounts are accumulated from A/P invoices and timesheets.

OT

Overtime hours are accumulated in the OT row of the hours column.

Committed

The dollar amounts of A/P purchase orders are recorded in the cost centres as committed amounts. The money hasn’t changed hands yet, but it’s been committed to. When the purchase orders are converted to invoices, the committed dollars for that purchase order will be converted to ‘costs to date’.

Forecast

These fields contain the forecasted cost for each posting type. If your company is setup for auto-forecasting, the costs to complete work will be forecast each time some factor in the cost changes. So, if invoices are posted to the centre, or labour dispersions added, or timesheets processed, or purchase orders posted, or quantities updated, or budgets adjusted, then the forecast is adjusted to reflect the changes. For a large project the forecast amounts are constantly changing. Which brings us to our next set of fields.

Snapshot Amounts as of YYYY.MM.DD

When you use the snapshot utility in Job Entry, Abio takes a copy of the current state of all the cost centres for the job. The most recent snapshot is displayed on the Centre Entry screen. You can see past snapshots on the Snapshots tab.

Mappings

The box at the bottom of the centre entry screen allows you to set up mappings for reporting purposes.

Client Item

This field is associated with the client P/O field in the client coding box. Abio will break out centre costs by costing type, and report the client P/O and item. This allows you to provide clients reports sorted and ordered by their own client purchase order and item.

Client Account

The J/C Centre List report includes this field in the file it exports.

Revenue Map

Record the cost centre A/R invoices use to bill this client for work done on this cost centre. The mapping allows the G/L Job Revenue Analysis report to map the cost of work done to it’s associated revenue. This serves as a check that the billing is being done correctly.

Revenue $

At the bottom right of the screen, revenue posted to this cost centre is recorded. Click on the hotlink to see the A/R invoices that make up this revenue.

Snapshots

The third tab on the centre entry screen shows the values for all the snapshots taken for this centre. You can review any snapshot by clicking on the date in the left hand column.