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- Transaction Type - Select the relevant type, such as Labor Cost Allocation.
- Entity - Choose the entity responsible for the costs.
- Basis - Choose the Payroll Calculation document. This is a required field because it provides the actual labor costs. The system uses this payroll data to retrieve employee salary amounts employees' salaries for allocation.
After the basis is selected, the system examines employee timecards for the corresponding period to determine how time was allocated across projects and then distributes the salary costs accordinglyThe “Use New Income & Expenses Reallocation Schema” option refers to an updated internal method (schema) used by the system to manage cost allocation logic.
Note: This is a system-controlled setting and is not amendable by users.
Allocation of Labor Cost
This tab is available for documents with the Labor Cost Allocation transaction type. The tab contains two tables: Labor Costs and Allocation Results.
The Labor Costs table is automatically filled based on the payroll calculation document chosen selected on the Main tab. Each employee may appear in one or more rows, depending on the number of accrual types included in the payroll document. Users can remove unnecessary rows and adjust the amounts to be allocated.
Deductions from payroll calculations are generally excluded from project cost allocation to avoid double-counting project costs. However, if a deduction is marked as manually adjusted during payroll calculation, it is included in the upper tablethe allocation as a negative amount and distributed across projects, thereby reducing the corresponding project costs.
- Cost Item - The cost category being allocated.
- Employee - The name of the employee whose labor costs are being allocated.
- Accrual Type - Type of accrual per row.
- Expense Item - The GL expense type to which this cost belongs.
- Business Activity - The type of business activity linked to the cost.
- Department - Shows the department associated with the employee or cost.
- Amount - Total cost for this employee/accrual type that will be allocated to projects or non-project work.
- Amount (National Currency) - The value of this cost in the company’s base currency.
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The Allocation Results table shows how labor costs are assigned to projects or tasks. It calculates how much of an employee’s labor cost goes to each project based on allocation factors. If an employee isn’t part of any project team, their cost is shown as <Not related to projects>.
Cost allocation can be done either using payroll calculation documents or by selecting the “Allocate by Time Card” option.
Once the basis is chosen and “Fill by Basis” is clicked, the system checks whether the employee is assigned to any active projects. If the employee is working on multiple projects, their salary is evenly distributed across them. Alternatively, when the Time Card option is selected, allocation is based on submitted time cards for the selected period, which reflect how working hours are split among projects, and salary costs are then distributed accordingly.
- Project / Project Task - Indicates where labor costs are allocated; costs can be split across projects or specific tasks.
- Project WBS - A hierarchical code used to identify the exact level within the project structure.
- Factor - The proportion of the total labor cost assigned to each project or task.
- Amount - The calculated cost allocated to the project/task based on the factor.
- Amount (National Currency) - The amount value shown in the company’s base currency.
- Remaining Budget Amount - Displays the available budget after allocation
- Project - Remaining budget for the entire project
- Project Task - Remaining budget for the specific task
- Project WBS - Remaining budget for the specific WBS level
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Project costs are allocated based on the time card date. The document date must match the time card date, and only hours within the project’s proposed period are applied. If the dates don’t align, no allocation occurs.
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The Recognized by Time Cards table tab reverses entries in the Income and Expense by Projects register that were created by timecardstime cards. This tab manages project cost allocation using employee timecards, allowing the system to reverse previous cost assignments with negative amounts and reallocate payroll costs based on actual hours worked. Only timecards from the same accounting period are considered, so costs are applied in the correct period, while any unassigned hours remain as non-project costs.
Additional information tab
On this tab, users can enter optional details for the document, such as the department and the person responsible for the allocation. No fields are mandatory.
