Oracle® Fusion
Applications Project Management Implementation Guide 11g Release 1 (11.1.1.5.0) Part Number E20384-01 |
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This chapter contains the following:
Nonlabor Cost Rates: How They Are Determined
Turning Equipment into Nonlabor Resources: Example
FAQs for Define Nonlabor Costing Schedules and Rules
Oracle Fusion Projects uses cost rates to calculate the raw cost for transactions. For example, for cost transactions, the application determines a cost rate for each transaction and calculates the raw cost during transaction costing, unless you import the raw cost for transactions.
Oracle Fusion Projects applies the following rules to determine the cost rate for each transaction.
The application uses an organization costing rule to determine the nonlabor cost rate schedule, using the following logic. At each level, the application searches for a rule with a date range that includes the transaction date.
Organization costing rule for the expenditure organization.
The application searches for an active costing rule assigned to the organization of the transaction on the date of the transaction.
Organization costing rule for the parent expenditure organization.
If an organization costing rule for the expenditure organization is not found, the application searches for a rule assigned to the parent organization of the expenditure organization, and continues up the project expenditure organization hierarchy until a rule is found.
You specify the project expenditure organization hierarchy for the business unit during implementation. If an organization has multiple parent organizations, and a rule is assigned to more than one parent, the application uses the rule assigned to the lowest level parent organization.
Organization costing rule for the business unit.
If no costing rule is found for the expenditure organization and parent organization, the application uses the costing rule assigned to the business unit for the transaction.
The application uses the nonlabor rate schedule and then applies the cost rate that is associated with the unique combination of expenditure type, nonlabor resource, and nonlabor resource organization.
If a cost rate does not exist for the combination of expenditure type, nonlabor resource, and nonlabor resource organization, then the application uses the cost rate for the expenditure type and nonlabor resource combination that is applicable to all nonlabor resource organizations to which the nonlabor resource belongs.
Note
This rule applies to cost transactions only. For billing and planning transactions, you can either not use a nonlabor resource organization, or map the nonlabor resource organization to the organization that maintains the rate schedule.
If a cost rate does not exist for the combination of expenditure type and nonlabor resource, then the application uses then the applications uses the cost rate defined for the expenditure type.
If a rate is not found at any of these levels, then an error is generated for the transaction.
This example illustrates setting up assets as nonlabor resources.
You are asked to set up nonlabor resources and assign them to the appropriate organizations for the InFusion Corporation.
InFusion Corporation wants to capture costs for computer equipment, vehicles, survey equipment, and other assets.
In this example, assume that expenditure types and organizations are already set up, which are prerequisites of defining nonlabor resources.
The Other Assets expenditure type is assigned to all divisions. This nonlabor resource captures miscellaneous items.
To define a nonlabor resource, you specify a name and description of each asset, such as a piece of equipment or pool of assets, and a date range during which the resource can be used.
For each nonlabor resource, you must choose an expenditure type with the Usage expenditure type class. Every usage item that you charge to a project must specify the nonlabor resource utilized and the nonlabor resource organization that owns the resource. You can select organizations that are classified as project and task owning organizations or project expenditure organizations.
A nonlabor resource may be a piece of equipment with capacity that is consumed, such as a training room, or equipment with physical output that is consumed, such as a copier. Enable the Equipment resource class to plan and report nonlabor resources as equipment with capacity that is consumed.
The following table shows the nonlabor resources for InFusion Corporation.
Resource Name |
Description |
Expenditure Type |
Equipment Resource Class |
From Date |
Organizations |
---|---|---|---|---|---|
Laptop |
Laptop on the Headquarters Network |
Computer Services |
Not enabled |
January 1, 2011 |
Data Systems Finance Information Services Risk Analysis |
HQ SPARC T3-1 Server |
Headquarters Sparc Enterprise Server |
Computer Services |
Not enabled |
January 1, 2011 |
Information Services |
Oracle Exadata Storage Server |
Data Systems Oracle Storage Server |
Computer Services |
Not enabled |
January 1, 2011 |
Data Systems |
Oracle Solaris Studio |
Engineering and Services Oracle Development Platform |
Computer Services |
Not enabled |
January 1, 2011 |
InFusion Engineering InFusion Services |
Survey |
Standard Surveying Equipment |
Field Equipment |
Enabled |
May 1, 2011 |
InFusion Engineering |
Van |
Heavy Duty Van |
Vehicle |
Not enabled |
January 1, 2011 |
InFusion Construction West Midwest East South International |
Minivan |
Site Visit Minivan |
Vehicle |
Not enabled |
August 1, 2011 |
InFusion Construction West Midwest East South International |
Pickup Truck |
Heavy Duty Pickup Truck |
Vehicle |
Not enabled |
January 1, 2011 |
West Midwest East |
Other Asset |
Other Asset |
Other Assets |
Not enabled |
January 1, 2011 |
Administration InFusion Construction InFusion Engineering InFusion Services |
An asset or a pool of assets. For example, a nonlabor resource may be a piece of equipment with capacity that is consumed, such as a training room, or equipment with physical output that is consumed, such as a copier.
Note
Before you create nonlabor resources, you must define organizations and expenditure types.
To define nonlabor resources, you can choose only expenditure types that belong to the Usages expenditure type class.
To plan and report on equipment as a nonlabor resource with capacity that is consumed, enable the Equipment resource class. The expenditure type that is associated with the Equipment resource class must have a unit of measure in Hours.
The organization to which a nonlabor resource is assigned. For example, a nonlabor resource named Survey may represent a piece of survey equipment that is assigned to the Engineering organization, and a nonlabor resource named PC may represent a pool of personal computers that are assigned to the Information Services, Finance, and Engineering organizations.
Note
Any organization from the organization hierarchy can be assigned nonlabor resources, regardless of whether the organization has the Project Expenditure Organization classification, and regardless of the start and end dates for the organization.
Every usage item that you charge to a project must specify the nonlabor resource utilized and the nonlabor resource organization to which the resource is assigned.