Cost Hierarchy

Cost Hierarchy Levels

The level you enter costs is a key determinant in how the application builds the cost account number. The application starts with the lowest level (element entry) and ends with the highest level (payroll), checking for a value at each level until it finds a value. If it finds an invalid cost combination, it places the costing result in a suspense account.

At the person level, costing details at the payroll relationship level apply to all the person's elements unless overrides are specified for the person at the assignment level. For person element, the level checked depends on the level specified in the element definition. For example, most deduction elements are defined at the payroll relationship level and earnings elements at the assignment level.

Levels Checked for Different Accounts

The costing process considers the type of account and the costing type of the element to determine which levels to use for processing.

This table summarizes the levels checked for different types of accounts.

Accounts	Costing Type Option	Levels of Cost Hierarchy Checked
Cost	Costed, Distributed	All
Cost	Fixed	Payroll, Element Eligibility, Element Entry
Suspense, Default	Not applicable	Payroll, Department
Offset, Priority	Not applicable	Element Eligibility

Levels Checked When Calculating Run Results

The Calculate Payroll process builds the account number for the payroll run results as of the current payroll period. The Recalculate Payroll for Retroactive Changes process checks for costing details for account segments in the current payroll period before using the segment values from the original payroll period.

For example, when calculating the costing for a retroactive pay earnings element, the application checks first for a segment value for the retroactive pay element in the current payroll period. It checks the element entry level and then the element eligibility level. If it doesn't find any value for the segment there, it uses the costing of the original payroll period, beginning with the element entry level. If it doesn't find costing details there, it continues checking each level of the original payroll period until it finds a value for the segment.

You can use this table to understand how costing details for elements are derived, such as which levels the application checks for costing details, based on the type of account and costing type, and where you set up the values for the account segments for that level.

Derives details for elements

Hierarchy Level	Accounts Checked	Costing Types	Costing Setup Pages
Element Entry	Cost	Fixed Costed, Costed, Distributed	Element Entries
Person Element - Assignment	Cost	Costed, Distributed	Costing for Persons
Person Element - Payroll Relationship	Cost	Costed, Distributed	Costing for Persons
Person - Assignment	Cost	Costed, Distributed	Costing for Persons
Person - Payroll Relationship	Cost	Costed, Distributed	Costing of Persons
Position - Assignment	Cost	Costed, Distributed	Costing of Positions
Job - Assignment	Cost	Costed, Distributed	Costing of Jobs
Location-Assignment	Cost	Costed, Distributed	Costing of Locations
Department - Assignment	Cost, Default, Suspense	Costed, Distributed	Costing of Departments
Element Eligibility	Cost, Offset, Priority	Fixed Costed, Costed, Distributed	Costing of Elements
Payroll	Cost, Default, Suspense	Fixed Costed, Costed, Distributed	Costing of Payrolls

You can use this table to understand how costing details for retroactive elements process in the payroll run:

Costing details for retroactive elements processed in the payroll run

Hierarchy Level	Sequence for Checking Details	Payroll Period Checked	Accounts Checked	Costing Types	Costing Setup Pages
Retroactive Pay Element Entry	First level checked for costing details when building each account segment for retroactive pay elements only. If costing details aren't found for that segment, the application proceeds to the next level, the Retroactive Pay Element Eligibility level.	Current	Cost	Fixed Costed, Costed, Distributed	Element Entries
Retroactive Pay Element Eligibility	Next level checked for retroactive pay elements only. If costing details aren't found for that segment, the application proceeds to the Element Entry level of the original payroll period.	Current	Cost	Fixed Costed, Costed, Distributed	Costing of Elements
Element Entry	Next level checked.	Original	Cost	Fixed Costed, Costed, Distributed	Element Entries
Person Element - Assignment	Next level checked.	Original	Cost	Costed, Distributed	Costing for Persons
Person Element - Payroll Relationship	Next level checked.	Original	Cost	Costed, Distributed	Costing for Persons
Person - Assignment	Next level checked.	Original	Cost	Costed, Distributed	Costing for Persons
Person - Payroll Relationship	Next level checked.	Original	Cost	Costed, Distributed	Costing for Persons
Position - Assignment	Next level checked.	Original	Cost	Costed, Distributed	Costing of Positions
Location - Assignment	Next level checked.	Original	Cost	Costed, Distributed	Costing of Locations
Job - Assignment	Next level checked.	Original	Cost	Costed, Distributed	Costing of Jobs
Department - Assignment	Next level checked.	Original	Cost, Default, Suspense	Costed, Distributed	Costing of Departments
Element Eligibility	Next level checked.	Original	Cost, Offset, Priority	Fixed Costed, Costed, Distributed	Costing of Elements

You can use this table to understand how costing details for retroactive pay elements with distributed costing distributed over retro element entries and with at least one segment populated in distributed element eligibility level process in the payroll run:

Costing details for elements with distributed costing distributed over retro element entries and with at least one segment populated in distributed element eligibility level processed in the payroll run

Hierarchy Level	Sequence for Checking Details	Payroll Period Checked	Accounts Checked	Costing Types	Costing Setup Page
Retroactive Pay Element Entry	First level checked for costing details when building each account segment for retroactive pay elements only. If costing details aren't found for that segment, the application proceeds to the next level.	Current	Cost	Distributed	Element Entries
Retro Distributed Element Eligibility	Next level checked for retroactive pay elements with distributed costing only. If costing details aren't found for that segment, the application proceeds to the Element Entry level of the original payroll period.	Current	Cost	Distributed	Costing of Elements
Element Entry	Next level checked.	Original	Cost	Distributed	Element Entries
Person Element - Assignment	Next level checked.	Original	Cost	Distributed	Costing of Persons
Person Element - Payroll Relationship	Next level checked.	Original	Cost	Distributed	Costing of Persons
Person - Assignment	Next level checked.	Original	Cost	Distributed	Costing of Persons
Person - Payroll Relationship	Next level checked.	Original	Cost	Distributed	Costing of Persons
Position - Assignment	Next level checked.	Original	Cost	Distributed	Costing of Positions
Job - Assignment	Next level checked.	Original	Cost	Distributed	Costing of Jobs
Location - Assignment	Next level checked.	Original	Cost	Distributed	Costing of locations
Department - Assignment	Next level checked.	Original	Cost, Default, Suspense	Distributed	Costing of Departments
Distributed Element Eligibility	Next level checked.	Original	Cost, Offset, Priority	Distributed	Costing of Elements
Payroll	Last level checked for costing information. If the resulting account combination is invalid, the result is placed in a Suspense account, or if unallocated the result is placed in a Default account.	Original	Cost, Default, Suspense	Distributed	Costing of Payrolls