1. General Accounting Implementation Guide
  2. Understanding Segments and Burdening Categories

Understanding Segments and Burdening Categories

Segments are codes that represent reporting units within a company and are used to define the types of costs incurred and allocated. You can calculate burdening differently for different segments. You set up each segment to define the burden categories, the source of the burdening rate, and the sequence in which the burden categories are calculated and processed.

For example, you might set up a segment with burden categories in this sequence:

  1. Fringe

  2. Overhead

  3. Material handling

  4. General and administrative

The system automatically creates a record for raw cost using burden category RC and sequence number 0.01 for each segment. However, this record does not appear on the Segment Definition Revisions form. You use this record when you set up burden computation methods. The system issues an error message if you attempt to add RC as a burden category.

Note: You might set up the same burden categories for more than one segment. You can differentiate the burdening calculations for the segments in other ways.

The sequence of the burden categories is important because you can use only burden categories with a higher sequence number in the calculation of a burden category. For example, if you sequence burden categories as fringe, overhead, material handling, and then general and administrative, the calculation of fringe can be based only on raw cost. Overhead can use the raw cost and the fringe cost in the calculation. You use the Burden Computation Methods program (P48S81) to indicate which of the available values to use in the calculation.

Note: You cannot delete a segment or burden category that has dependent burdening records in the Burden Computation Method table (F48S81), the Burden Base Rules table (F48S82), the Pool Definition table (F48S83), the Pool Grouping Codes table (F48S84), or the Burden Rates table (F48S85). To delete a segment or burden category, first check the dependent burdening tables and delete records attached to the segment or burden category, and then delete the segment or burden category.