Back to V300: Project Accounting for Construction

Lesson 21: Capturing Project Budget Overhead

Part 5: Project Budgets

A project can have indirect costs, such as administrative expenses, that are not included in the project budget. This lesson explains how you can capture these expenses as project overhead by allocating the project.

Overhead in the Project Budget: General Information

Your company can have such expenses as oﬀice rent or administrative expenses that are posted to the general ledger but not classified against projects and not presented in the project budget. For a more accurate estimation of the project profitability, you can capture such expenses as the project overhead.

Learning Objectives

In this lesson, you will learn how to do the following:

Configure an allocation rule to capture project overhead as a percentage of incurred costs
Capture the overhead on the project

Applicable Scenarios

If you need to more accurately estimate the profitability of a project—for example, for making management decisions or for project management—but the project has some indirect costs that are posted to the general ledger but not classified against the project, you capture these expenses as project overhead.

Creation of an Allocation Rule

To calculate the overhead for projects, you create an allocation rule on the Allocation Rules (PM207500) form. Using this allocation rule, the system creates allocation transactions based on the project transactions posted to a particular account group or specific groups. These allocation transactions post the calculated overhead amount to the specified account group. For this allocation rule, you specify the following settings on the Calculation Rules tab:

Allocation Method: Allocate Transactions With this setting, the system calculates the amount to allocate by using the underlying transactions and their amounts.
Create Allocation Transaction: Selected With this check box selected, the system creates the allocation transactions resulting from the step.
Selected Transactions (Selection Criteria section): Non-Allocated Transactions The step is applied to project transactions that have not been allocated yet.
Account Group From (Selection Criteria section): The account group that starts the range of account groups whose transactions are involved in the allocation step The account groups are ordered alphabetically.
Account Group To (Selection Criteria section): The account group that ends the range of account groups whose transactions are involved in this allocation step. If you want to allocate the transactions posted to a single account group, specify this account group in the Account Group From box, and leave the Account Group To box empty.
Quantity Formula (Calculation Settings section): =0
Billable Qty. Formula (Calculation Settings section): =0 You usually do not need to calculate the overhead quantity.
Amount Formula (Calculation Settings section): The overhead amount that you can calculate as a percentage of the amount of the original transaction. In this case, you use the following formula: =PMTran.Amount*multiplier. You can use a percentage as a multiplier (for example, 0.2 as 20%), a project attribute to define the percentage at the project level, or a rate. For more information on rates, see Billing Rates: General Information.
Description Formula (Calculation Settings section): The description of the created allocation transaction. You specify the following settings for the allocation rule on the Allocation Settings tab:
Post Transaction to GL (Transaction Options section): Cleared With this check box cleared, allocation transactions and reversing allocation transactions will not be posted to the general ledger.
Reverse Allocation (Transaction Reversal section): Never With this setting, the system does not create a reversing transaction for the allocation transactions. The allocation transactions that you create with this allocation rule do not aﬀect the general ledger and are not posted to any account, so you do not need to reverse them.
Account Group (Debit Transaction section): Replace with an account group for capturing the overhead With this setting, the system generates an allocation transaction that debits the specified account group.
Account Group (Credit Transaction section): None You create an additional cost with the allocation transaction and do not need to credit any account group.

Configuration of Projects for Allocation

On the Projects (PM301000) form, for a project to be allocated, you assign the created allocation rule to the project
tasks on the Tasks tab.

Allocation of Projects

You run the allocation process for a project by clicking Run Allocation on the More menu of the Projects
(PM301000) form while reviewing the project. As a result, the system creates allocation transactions based on the
project transactions selected by using the allocation rules specified for project tasks on the Tasks tab. To make
it possible to identify a batch of created allocation transactions, the system assigns the Allocation for <Project ID>
description to such a batch. For the project transactions that have been used as a source of the allocation, the
system selects the Allocated check box on the Project Transaction Details (PM401000) form.

Overhead in the Project Budget: Implementation Activity

The following implementation activity will walk you through the process of configuring an allocation rule for
capturing the overhead for projects.

Story

Suppose that the project manager of the SweetLife Fruits & Jams company wants to estimate the project costs
considering the administrative overhead of the project management to be able to estimate the project profitability
more accurately. The company estimates the project overhead as 20% of labor costs, such as a worker's time spent
on performing the project.
Acting as SweetLife’s implementation manager, you need to configure an allocation rule to capture the project
overhead as 20% of labor costs to reflect the overhead in the project budget. Because the administrative overhead

is already presented in the general ledger in the form of transactions that are not classified against projects, you do not need to post to the general ledger allocation transactions that are created.

Configuration Overview

In the U100 dataset, the following tasks have been performed to support this activity:

On the Enable/Disable Features (CS100000) form, the Project Accounting feature has been enabled to support the project accounting functionality.
On the Account Groups (PM201000) form, the OVERHEAD and LABOR account groups have been created.

Process Overview

You will configure an allocation rule for capturing the labor overhead on the Allocation Rules (PM207500) form.

System Preparation

To prepare to perform the instructions of the activity, sign in to a company with the U100 dataset preloaded; you should sign in as system administrator by using the gibbs username and the 123 password.

Step: Configuring an Allocation Rule To configure an allocation rule used for capturing the project overhead as a percentage of labor costs, perform the following instructions:

On the Allocation Rules (PM207500) form, add a new record.
In the Summary area, specify the following settings:

Allocation Rule: LABOVERHEAD
Description: Labor overhead

In the Allocation Steps table, add a row for the allocation rule step with the following settings:

Step ID: 10
Description: Labor

In the right pane, on the Calculation Rules tab, specify the following settings of the allocation step:

Allocation Method: Allocate Transactions
Create Allocation Transaction: Selected
Select Transactions (Selection Criteria section): Non-Allocated Transactions
Account Group From (Selection Criteria section): LABOR
Account Group To (Selection Criteria section): Empty Based on this setting and the previous setting, with this step, the allocation rule processes only transactions of the LABOR account group.
If @Rate Is Not Defined (Calculation Settings section): Set @Rate to 0 You will not use rates to calculate the amount of the allocation transaction.
Quantity Formula (Calculation Settings section): =0
Billable Qty. Formula (Calculation Settings section): =0
Amount Formula (Calculation Settings section): =PMTran.Amount*0.2 You calculate the overhead amount as 20% of the transaction amount.
Description Formula (Calculation Settings section): ='Project overhead for labor'

In the right pane, on the Allocation Settings tab, specify the following settings of the allocation step:

Post Transaction to GL (Transaction Options section): Cleared
Reverse Allocation (Transaction Reversal section): Never The project overhead is not considered in billing and you do not need to create reversing allocation transactions.
Account Group (Debit Transaction section): Replace with OVERHEAD With this setting, the system generates an allocation transaction that debits the specified account group —that is, the OVERHEAD account group.
Account Group (Credit Transaction section): None

Save the created allocation rule.
You have configured the allocation rule that can be used for capturing the project overhead as 20% of labor costs. To allocate the labor expenses of a project by using this rule, you need to assign the rule to the project tasks.

Construction Project Budget: To Estimate the Budget Overhead

In this activity, you will learn how to estimate the project overhead calculated based on the project costs.

Story

Suppose that ToadGreen Building Group is a general contractor building an Italian restaurant for its customer, the Italian Company. On March 17, 2025, the construction manager spent 10 working hours on communication related to obtaining construction permits; this time had not initially been budgeted for the project. Acting as the project accountant, you need to record these additional expenses in the project budget by entering the corresponding project transaction and do not update the general ledger with these expenses. Then you need to estimate the project costs while accounting for the administrative overhead, which is 20% of labor costs.

Configuration Overview

In the U100 dataset, the following tasks have been performed to support this activity:

The Construction feature has been enabled on the Enable/Disable Features (CS100000) form to provide support for the construction functionality.
On the Projects (PM301000) form, the ITALIAN3 project has been created. Project tasks have been added to the project, and the project budget has been defined.
On the Account Groups (PM201000) form, the OVERHEAD account group has been created.
On the Allocation Rules (PM207500) form, the OVERHEAD allocation rule has been created. This allocation rule has been configured to process project transactions that represent labor expenses and to post the overhead, which is calculated as 20% of the transaction amount, to the OVERHEAD account group.

Process Overview

In this activity, you will first specify the allocation rule for the project task on the Projects (PM301000) form. On the same form, you will then perform allocation for the project and review the project balances.

System Preparation

To prepare to perform the instructions of the activity, do the following:

Sign in to the system as a project accountant by using the bsanchez username and the 123 password.
In the info area, in the upper-right corner of the top pane of the Acumatica ERP screen, make sure that the business date in your system is set to 3/17/2025. If a diﬀerent date is displayed, click the Business Date menu button, and select 3/17/2025 on the calendar. For simplicity, in this activity, you will create and process all documents in the system on this business date.

Step 1: Creating a Project Transaction To create a project transaction that represents the additional expenses, which do not aﬀect the general ledger, do the following:

On the Project Transactions (PM304000) form, add a new project transaction.
In the Summary area, make sure PM is selected as the Module.
Enter Additional operational expenses (March) as the Description.
On the table toolbar, click Add Row, and specify the following settings in the added row:

Project: ITALIAN3
Project Task: 01
Cost Code: 01-314
Account Group: LABOR
UOM: HOUR
Quantity: 10
Billable: Cleared
Amount: 1,400 You have le the Debit Account and Credit Account columns empty so that the corresponding general ledger transaction will not be created. The system also will not use this transaction for billing because you have cleared the Billable check box in the row.

On the form toolbar, click Release to save your changes to the project transaction and release it. Notice that the GL Batch Nbr. column of the row is empty, indicating that no corresponding general ledger transaction has been created.
You have finished capturing the costs for the project.

Step 2: Capturing Project Overhead To configure the project for allocation and capture the project overhead, do the following:

On the Projects (PM301000) form, open the ITALIAN3 project.
On the Tasks tab, in the line with the 01 project task, select the OVERHEAD allocation rule in the Allocation Rule column.
Save your changes to the project. On the Balances tab, notice the expense line with the LABOR account group and the actual amount of $1,400.
On the More menu, under Billing and Allocations, click Run Allocation. The system performs the allocation by using the allocation rule that you have specified for the project task. When the allocation is completed, on the Balances tab, review the project balance again, as shown in the following screenshot. Notice that one more expense line with the OVERHEAD account group has appeared in the table. The actual amount of the line is $280, which is 20% of $1400. Figure: The captured overhead in the project expenses
In the table, click the line with the OVERHEAD account group, and on the table toolbar, click View Transactions. On the Project Transaction Details (PM401000) form that opens, review the line with the created allocation transaction that corresponds to the account group. In the Orig. Doc. Type column, the type of the transaction is Allocation. In the Debit Account Group column, the OVERHEAD account group is specified.

You have recorded expenses and estimated the project overhead. Additional Materials | 131

Additional Materials

This part provides supplemental information related to the processes and examples in the course.

Reviewing the Unbilled Quantities of a Subcontract

To check whether a subcontract has quantities of items and amounts that have not yet been billed, you review the Unbilled Quantity and Unbilled Amount boxes on the Financial tab of the Subcontracts (SC301000) form.

Printing Subcontracts

While you are viewing a subcontract on the Subcontracts (SC301000) form, you can print the document by clicking Print on the form toolbar. The system opens the printable version of the document on the Subcontract (SF) (SC641000) report; then you can review the document and print it by clicking Print on the report toolbar.

Subcontracts: Mass Processing

The following sections explain how to mass-process subcontracts.

Mass Printing of Subcontracts

To print subcontracts in bulk, you use the Print/Email Subcontracts (SC503000) form. You select Print in the Action box, select the check boxes in the rows of the needed subcontracts in the table, and click Process on the form toolbar; you can click Process All on the form toolbar to print all the subcontracts listed in the table.

Mass Emailing of Subcontracts

To send emails with multiple subcontracts, you use the Print/Email Subcontracts (SC503000) form. You select Email in the Action box, select check boxes in the rows of the needed subcontracts in the table, and click Process on the form toolbar; you can click Process All to send emails with all the subcontracts listed in the table.

Correction of a Bill for a Subcontract: Related Report and Inquiry Forms

The following sections describe the reports, inquiries, and forms you may review to gather information about billed amounts and quantities in subcontracts, vendor balances, and debit adjustments processed for subcontracts.

          If you do not see a particular report or form that is described, you may have signed in to the system
          with a user account that does not have access rights to the report or form. Contact your system
          administrator to obtain access to any needed reports or forms.

If you need to find an accounts payable document linked to a particular subcontract, you open the subcontract on the Subcontracts (SC301000) form and review the Billing tab. The table on this tab lists all the accounts payable documents that have been released for the subcontract, and the table footer shows the summary information for all listed documents. To review the details of a particular document, you click its reference number in the Reference Nbr. column; the system opens the accounts payable bill or debit adjustment for review on the Bills and Adjustments (AP301000) form.

You can also find bills or applied payments related to a subcontract by using the Subcontract Audit (SC644000) report form. You open the Bills and Adjustments form by clicking Ref. Nbr. in the Bills section or clicking Applied To in the Applied To section of the report. Additional Materials | 133

Reviewing the Unbilled Quantities of a Subcontract

To check whether a subcontract has quantities of items and amounts that have not yet been billed, you review the Unbilled Quantity and Unbilled Amount boxes on the Details tab (for each individual line) of the Subcontracts (SC301000) form, or the total unbilled amount and unbilled quantity on the Financial tab of the form.

Reviewing the Subcontractor's Outstanding Balance You use the Vendor Details (AP402000) form to review the outstanding balance of a particular subcontractor. The debit adjustments you create in the system decrease the outstanding balance of the subcontractor.

Reviewing the Subcontractor's Balance and Documents You run the AP Balance by Vendor (AP632500) report to review the balance and documents of a particular subcontractor for a particular period.

Project Inventory Tracking: Item Availability Tracking

In Acumatica ERP, you can configure the way that availability data is calculated in accordance with your company's policies. The following sections describe how the system indicates that inventory has enough items for processing documents if the Project-Specific Inventory feature is enabled on the Enable/Disable Features (CS100000) form.

Reviewing Availability Status of Stock Items

For stock items, the system calculates availability status based on the availability calculation rules, which you define on the Availability Calculation Rules (IN201500) form. To specify how the system calculates availability for particular items, you assign the availability calculation rules you have created to particular item classes on the Item Classes (IN201000) form. By default, each item of this item class is assigned this rule. You can override the default availability calculation rule for each particular stock item on the Stock Items (IN202500). When the documents that record inventory transactions have been released, Acumatica ERP automatically updates the on-hand quantities of items at warehouses. On-hand quantities usually diﬀer from the quantities that are actually available because documents may be processed aer the actual operations with items have been performed. For more information about the configuration of availability rules, see Availability Calculation Rules: General Information.

Reviewing Project-Specific Availability Data When a user adds a line with an inventory item to a sales order, shipment, purchase receipt, or inventory transaction, the system calculates and shows the availability quantities for each line in the table footer on the Details tab of the following forms:

Sales Orders (SO301000)
Shipments (SO302000)
Purchase Receipts (PO302000)
Receipts (IN301000)
Issues (IN302000)
Adjustments (IN303000)
Transfers (IN304000)
Service Orders(FS300100)
Appointments(FS300200) Additional Materials | 134
In the project-related lines of documents and transactions, the way the system shows item availability for each line depends on the setting of the selected project that is specified in the Inventory Tracking box on the Summary tab of the Projects form. For each of the availability buckets, the system shows two values (separated by a slash) if the line has a warehouse location that is linked to a project that has the Track by Project Quantity or Track by Project Quantity and Cost inventory tracking mode. The quantities are calculated as follows:
The first value shows the available quantity of items in the selected warehouse location related to this particular project and project task.
The second value shows the total quantity of free stock items and project stock items stored in this warehouse location. For each of the availability buckets, the system shows one value if the following is true for the line:
The line has a warehouse location that is linked to a project with the Track by Location inventory tracking mode. Each quantity is calculated based on the items received to this location for this project and the items received to this location with a non-project code.
The line is not linked to any project. That is, this line has the non-project code specified. Each quantity is calculated based on the items received to this location with a non-project code.

Purchases with a Sales Tax: Related Report and Inquiry Forms

The following sections describes reports, inquiries, and forms you may review to gather information about AP bills.

           If you do not see a particular report or form that is described, you may have signed in to the system
           with a user account that does not have access rights to the report or form. Contact your system
           administrator to obtain access to any needed reports or forms.

Reviewing the Details of an Unreleased Bill

If a bill has not yet been released, you can review the details of the bill by running the AP Edit Detailed (AP610500)
report. When you run this report from the Bills and Adjustments (AP301000) form by clicking AP Edit Detailed
(under Reports) on the More menu, the report shows the details of the bill opened on this form. You can review
what GL batch the system will create when you release the bill, which accounts will be updated by the transaction,
and how the vendor's balance will be aﬀected.

Reviewing the Details of a Released Bill

Once you have released a bill, you can review the details of the bill by running a report on the AP Register Detailed
(AP622000) form. When you run this report from the Bills and Adjustments (AP301000) form by clicking AP Register
Detailed (under Reports) on the More menu, the report shows the details of the bill opened on this form. You can
review the GL batch the system created when releasing the bill and the accounts that have been updated by the
transaction.

Reviewing Vendor Information

You can review the balances of a specific vendor on the Vendor Details (AP402000) form. When you open this
inquiry from the Bills and Adjustments (AP301000) form by clicking Vendor Details (under Inquiries) on the More
menu, the Vendor Details form is opened, showing the outstanding balances of the selected vendor and a list
of documents of this vendor that have the Open status. You can select the Show All Documents and Include
Unreleased Documents check boxes in the Selection area of the form to include all documents and unreleased
documents, respectively, in the inquiry.

Additional Materials | 135

Reviewing the Vendor's Balance Aer a bill has been released, you can review the vendor's balance on the AP Balance by Vendor (AP632500) form. On this form, you select Open Documents in the Report Format box and specify the needed financial period. In the report, you can review open documents and vendor balances at the end of the period, grouped by vendor and by AP account. When you release a bill or an adjustment, the system updates the vendor balance. Vendor Documents Total is the total amount of all open documents of the vendor.

The Progress Billing Process

Progress billing is a simple billing workflow for the projects that are gradually billed at a fixed contract amount. Progress billing does not involve project transactions. To bill a project task by its progress, you need to create a billing rule on the Billing Rules (PM207000) form and configure a step of the Progress Billing type in this rule. Then you assign the configured billing rule to project tasks on the Tasks tab of the Projects (PM301000) form.

          If a project is billed with a billing rule that includes only a Progress Billing billing step, during the
          billing process, the system ignores any unbilled project transactions.

The progress billing procedure could be initiated for a project if either of the following is true:

It has at least one revenue budget line with billable project revenue.
It has pending values of 0 if the progress billing step of the billing rule assigned to any project task has the Create Lines with Zero Amount and Quantity check box selected on the Billing Rules form. For more information, see Billing with a Direct AR Invoice: General Information. Each revenue budget line is billed based on amount or quantity, depending on the option selected in the Progress Billing Basis column on the Revenue Budget tab of the Projects form as follows:
For a line billed by amount, you need to specify a nonzero amount, which may be a negative amount, in the Pending Invoice Amount column. For these lines, the Pending Invoice Quantity, Dra Invoice Quantity, and Actual Quantity values are always 0.
For a line billed by quantity, you need to specify a nonzero quantity in the Pending Invoice Quantity column. In this case, the system will calculate the Pending Invoice Amount of the line as the pending invoice quantity multiplied by the unit rate specified in the line. The system will calculate the percentage of line completion (Completed (%)) based on the specified values. You can also specify the Completed (%) value on the Revenue Budget tab for the needed revenue budget lines to indicate that the project tasks are being performed. The system will calculate the pending invoice values by using the following formulas: Pending Invoice Amount = Revised Budgeted Amount * ( Completed (%) / 100 ) - Draft Invoice Amount - Actual Amount Pending Invoice Quantity = Revised Budgeted Quantity * ( Completed (%) / 100 )
Draft Invoice Quantity - Actual Quantity
```
        Project-related invoices, debit memos, and credit memos that have been created manually on the
        Invoices and Memos (AR301000) form are not included in pending invoice quantities and amounts.
```
You run billing for one project by clicking the Run Billing button on the form toolbar of the Projects form or process multiple projects on the Run Project Billing (PM503000) form. When you run the project billing, the system prepares a project invoice whose type depends on the state of the Create Pro Forma Invoice on Billing check box on the Summary tab of the Projects form as follows:
If the check box is selected, the system generates a pro forma invoice with a positive or negative amount.
If the check box is cleared, the system generates an accounts receivable invoice (if the billed amount is positive) or credit memo (if the billed amount is negative). For more information about credit memos, see Project Invoice Correction: Credit Memos for Projects. The system creates a project invoice with the unit prices, amounts, and quantities copied from the Unit Rate, Pending Invoice Amount and Pending Invoice Quantity columns of the Revenue Budget tab of the Projects form for the corresponding revenue budget lines. If the project billing is performed by using the pro forma invoice workflow, the pro forma invoice lines that are produced by the progress billing steps are shown in the prepared pro forma invoice on the Progress Billing tab of the Pro Forma Invoices (PM307000) form. Additional Materials | 137
During the billing process, the system groups the billable amounts into invoices based on the following:
The invoice group of the steps of the billing rules to which the project tasks refer
The customer
The customer location
The Bill Separately setting of each project task defined on the Project Tasks (PM302000) form For more information, see Grouping of Invoices: General Information. Once an invoice is prepared, the Dra Invoice Amount and Dra Invoice Quantity of the revenue budget lines are updated with the amount and quantity for which the invoice has been prepared. The Pending Invoice Amount and Pending Invoice Quantity values become 0. If you manually adjust the Amount to Invoice of a pro forma invoice line, the system automatically recalculates the Total Completed (%) in this line. This is the percentage of the revised budgeted amount of the revenue budget line of the project that has been invoiced by all the pro forma invoices of the project, including the current one. However, the system does not update the Completed (%) of the corresponding revenue budget line on the Revenue Budget tab of the Projects form accordingly. Also, the system does not update the Completed (%) of the revenue budget line if the related pro forma invoice with the corresponding progress billing line is deleted. When you release a pro forma invoice and the system creates the corresponding accounts receivable invoice, the system copies the values in the Amount to Invoice column from the Progress Billing tab of the Pro Forma Invoices form to the corresponding lines of the accounts receivable invoice on the Details tab of the Invoices and Memos (AR301000) form.

Time and Material Billing: General Information

With time and material billing in Acumatica ERP, you run project billing to automatically generate customer
invoices based on the cost project transactions.

Learning Objectives

In this lesson, you will learn how to do the following:

Configure a time and material billing rule
Make sure that the project is ready to be billed
Run project billing for a project
Process the documents that have been generated during the project billing
Review how the project’s actual amounts are updated with the billed amounts

Applicable Scenarios

You run project billing to prepare an invoice for the customer for the time and material spent on the project. The
timing of project billing depends on the project billing period defined for the project.

Configuration of a Billing Rule Step

For a billing rule step of the Time and Material type, you can specify the following settings:

The account group that is used as a filter to select the transactions for billing by the Time and Material billing steps. When the billing procedure is run, the system selects all the transactions that are due for billing and that have this account group. Normally, you use for billing the same account group or groups that you use for accumulating the unrecognized revenue. Additional Materials | 138
A formula to define the description of the invoice and a formula to define the description of each invoice line, to make the system compose these descriptions dynamically during the billing process.
A formula to calculate the amount of the invoice lines created by the Time and Material billing steps, and another formula to calculate the quantity of these invoice lines. In these formulas, you can use fields and attributes from such entities as the project, project budget, project task, project transaction, customer, vendor, employee, inventory item, and account group. You can also use diﬀerent sources of the project rates: those from rate tables, which can be configured on the Rate Tables (PM206000) form; and those from sales price lists, which are defined on the Sales Prices (AR202000) form.
```
                If inclusive taxes are configured in the system, the amounts of project transactions are
                considered gross amounts—that is, already including the inclusive taxes. If the project
                transaction amounts that you enter in your system are net amounts (that is, it does not
                include an inclusive tax), you need to configure the line amount formula to include the
                PMBudget.InclTaxAmount value in the calculations.
```
The source of the sales account and the source of the destination branch for each invoice line. The billing process uses the originating branch from the project settings on the Projects (PM301000) form and the destination branches from the sources according to the billing rules. When an accounts receivable invoice is released, the accounts receivable account is updated under the originating branch of the invoice, while the revenue amounts are recorded to the destination branches of the invoice lines.
The invoice group, which can be used during billing to make the system create separate invoices (either pro forma invoices or accounts receivable invoices, depending on the billing workflow of the project) for particular steps with the same invoice group during the project billing.
Non-billable transactions that do not contribute to the amount billed to the customer and that you may decide to include in the invoice.
Grouping criteria by date, employee, vendor, and inventory item for the invoice lines created by the Time and Material billing steps.

The Time and Material Billing Process

The time and material billing workflow is provided for project tasks that need to be billed based on project transactions. Time and material billing can be performed only for project tasks of a project that is pending billing —that is, if the project has at least one unbilled transaction that is ready to be billed on the invoice date. The Time and Material billing steps can be run once the project transactions that match the selection criteria have been processed. Optionally, the allocation process can be executed for these transactions before billing. For more information, see Billing with a Direct AR Invoice: General Information.

          If a project is billed with a billing rule that includes only Time and Material billing steps, during the
          billing process, the system ignores any pending invoice amount of the revenue budget lines.

To bill a project task for time and material, you need to create a billing rule on the Billing Rules (PM207000) form and configure a step or multiple steps of the Time and Material type in this rule. Multiple Time and Material steps are used in a billing rule for diﬀerent account groups of transactions that should be used to determine the invoiced amounts by using diﬀerent formulas. Then you assign the configured billing rule to project tasks on the Tasks tab of the Projects (PM301000) form.

          If you configure multiple time and material steps for the same account group, only the last pro forma
          invoice line created based on these steps will be linked to the project transaction that has been used
          as a basis for billing.

You can run billing for one project by clicking the Run Billing button on the form toolbar of the Projects form or process multiple projects on the Run Project Billing (PM503000) form. When you run the project billing, the system Additional Materials | 139

prepares a project invoice whose type depends on the state of the Create Pro Forma Invoice on Billing check box on the Summary tab of the Projects form as follows:

If the check box is selected, the system generates a pro forma invoice with a positive or negative amount.
If the check box is cleared, the system generates an accounts receivable invoice (if the total billed amount is positive) or credit memo (if the total billed amount is negative). For more information about credit memos, see Project Invoice Correction: Credit Memos for Projects. The system creates a project invoice based on the unbilled project transactions with amounts calculated by using the billing rules of the project tasks. In the billing, the system includes the transactions with a date that is earlier than the billing date and does not include the transactions with a date that is later than the billing date. If the project billing is performed by using the pro forma invoice workflow, the invoice lines that are produced by the Time and Material billing steps are displayed on the Time and Material tab of the Pro Forma Invoices (PM307000) form. The transactions with the same date as the invoice date are billed if Include Transactions with Billing Date is selected as the Billing Cutoﬀ on the Projects Preferences (PM101000) form; if Include Only Transactions Before Billing Date is selected, the system skips the transactions with the same date as the invoice date. During the billing process, the system groups the billable amounts into separate invoices based on the following:
The invoice group of the steps of the billing rules to which the project tasks refer
The customer
The customer location
The Bill Separately setting of each project task defined on the Project Tasks (PM302000) form For more information, see Grouping of Invoices: General Information. If the status of a pro forma invoice is On Hold, you can change the Amount to Invoice values in the time and material lines of the pro forma invoice. When you release a pro forma invoice and the system creates the corresponding accounts receivable invoice or credit memo, the system copies the values in the Amount to Invoice column from the Time and Material tab of the Pro Forma Invoices form to the lines of the accounts receivable invoice (or credit memo) on the Details tab of the Invoices and Memos (AR301000) form. You cannot change the Amount to Invoice value in the lines of a pro forma invoice with the Open and Closed status.
```
        If the Construction feature is in use, you may need to prepare an American Institute of Architects (AIA)
        report that includes time and material amounts from the prepared pro forma invoice. To do this,
        you include the time and material amounts to be billed in the progress billing amounts. For more
        information, see Construction Reports: Time and Material Amounts in AIA Reports.
```

AP Bills with Retainage: Related Reports

In the following sections, you can find details about the report you may want to review to gather information about the accounts payable documents with retainage.

          If you do not see a particular report or form that is described, you may have signed in to the system
          with a user account that does not have access rights to the report or form. Contact your system
          administrator to obtain access to any needed reports or forms.

Reviewing Past Due Documents with Retainage

You can review past due documents and their unreleased retainage on the selected aging date using the AP Aging (AP631000) report. You prepare the report with the Detailed with Retainage report format. Based on the document due date, the system includes the document amount either in the Current column or in one of the Past Due Additional Materials | 140

columns. The retainage amount held for the AP documents is not aged and is shown in the Unreleased Retainage column.

Reviewing the Vendor's Balance You run the AP Balance by Vendor (AP632500) report to review the balance and documents of a particular vendor for a particular period.

AP Bills with Retainage: Mass-Processing of Documents

The following section explains how to release retainage bills for multiple AP bills.

Mass-Releasing Retainage To release retainage for multiple bills, you use the Release AP Retainage (AP510000) form. In the Selection area, you select the date for which you want to release the retainage. You can specify other selection criteria to filter the documents in the table, such as vendor and reference number. In the table, for each bill for which you want to release retainage, you review the Percent to Release or Retainage to Release column, and change the value in either column, if necessary. If you change either value, the system automatically recalculates the other value accordingly. You then select the check boxes in the unlabeled column for the bills for which you want to release the retainage and click Process on the form toolbar. If you want to release the retainage for all listed bills, you click Process All on the form toolbar.

AR Invoices with Retainage: Mass-Processing of Documents

The following section explains how to release retainage for multiple AR invoices.

Mass-Releasing Retainage To release retainage for multiple invoices, you use the Release AR Retainage (AR510000) form. In the Selection area, you select the date for which you want to create the retainage invoices. You can specify other selection criteria to filter the documents in the table, such as customer, project, project task, account group, cost code, and inventory ID. In the Retainage Percent box, you also can specify the percentage of retainage to be released for all invoices in the table; this percentage can be overridden for any invoice. In the table, for each invoice for which you want to release retainage, you should review the Percent to Release or Retainage to Release column, and change the value in either column, if necessary. If you change either value, the system automatically recalculates the other value accordingly. You then select the check boxes in the unlabeled column for the invoices for which you want to release the retainage and click Process on the form toolbar. If you want to release the retainage for all listed invoices, you click Process All on the form toolbar. Pro Forma Invoice Correction: Mass-Processing of Documents

This topic explains how to perform mass-processing operations related to pro forma invoices and AR documents, and how the system generates, changes, or works with documents as a result of the mass processing.

Mass-Releasing Pro Forma Invoices Pro forma invoices can be mass-released. To release multiple pro forma invoices at a time, you open the Release Pro Forma Invoices (PM506000) form, select the unlabeled check boxes in the rows of the pro forma invoices to be processed, and click Release on the form toolbar. To instead release all the listed pro forma invoices, you click Release All on the form toolbar.

Mass-Releasing AR Invoices Multiple invoices can be released at the same time on the Release AR Documents (AR501000) form. On this form, you select the unlabeled check boxes in the rows of the documents to be processed and click Release on the form toolbar to release the selected invoices; alternatively, you can click Release All to release all the invoices shown in the table.

Pro Forma Invoice Correction: Related Reports and Forms

In the following sections, you can find details about the reports and forms you may want to review to gather information about correcting pro forma invoices.

          If you do not see a particular report or form that is described, you may have signed in to the system
          with a user account that does not have access rights to the report or form. Contact your system
          administrator to obtain access to any needed reports or forms.

Reviewing Revisions of a Pro Forma Invoice

You can review all the previous revisions of the pro forma invoice selected on the Pro Forma Invoices (PM307000) form in the Previous Revisions table on the Financial tab. If there are several revisions in the table, the topmost row is the last revision of the pro forma invoice while revision 1 is the first revision of the invoice. For each revision, you can find in the table the reference number of the accounts receivable document created on release of the revision (AR Ref. Nbr.) and the reference number of the reversing AR document (Reversing Ref. Nbr.) created for that accounts receivable document. By clicking the reference numbers, you can opens these AR documents on the Invoices and Memos (AR301000) form.

You can review all the accounts receivable documents related to pro forma invoices of a project, including AR documents of the previous revisions of pro forma invoices and reversing AR documents, on the Invoices tab of the Projects (PM301000) form.

If a pro forma invoice has been corrected, the latest generated accounts receivable invoice is listed in the same row with the pro forma invoice. All the previous revisions of the accounts receivable invoices and reversing accounts receivable documents generated for the pro forma invoice are shown in the end of the invoices list. Additional Materials | 142

Comparing Revisions of a Pro Forma Invoice

You can compare all the revisions of a pro forma invoice on the Pro Forma Invoice Correction History (PMGI0030) form. In the Summary area of the form, in the Reference Nbr. box, you select a pro forma invoice whose revisions you want to review. In the table, the system displays all lines of all the revisions of the selected pro forma invoice. The lines are sorted ascending by the invoice line number and then descending by the invoice revision—that is, the system shows all the revisions of the first invoice line, then all the revisions of the second line, and so on. The lines of the current revision are highlighted with green and have the highest revision number. Joint Payments: Related Reports and Dialog Boxes

In the following sections, you can find details about the reports and dialog boxes you may want to review to gather information about the joint payments.

          If you do not see a particular report or form that is described, you may have signed in to the system
          with a user account that does not have access rights to the report or form. Contact your system
          administrator to obtain access to any needed reports or forms.

Reviewing Checks that Are Pending Printing

You can use the Checks Pending Printing (AP404000) form to review which checks have not been printed yet as of a specified pay date. You can initiate check printing on this form by clicking Print Checks on the form toolbar. The system navigates to the Process Payments / Print Checks (AP505000) form, where you can print checks.

Reviewing Joint Payments for a Bill

You can find the list of the joint payments that have been prepared for a joint bill on the Joint Amount Application tab of the Bills and Adjustments (AP301000) form. For each joint payment, the reference number of the related payment document is shown in the Payment Ref. column and the current status of the payment is shown in the Status column.

Creating a Joint Payment Manually

You can create a payment for a joint bill directly on the Checks and Payments (AP302000) form. On this form, you first create a payment to the main vendor and then click the Add Joint Payee button on the table toolbar of the Documents to Apply tab. In the Select Joint Payee dialog box, which opens, you select the line or lines to be paid for the joint payee vendor, and you click Add & Close to add these lines to the bill. You can add to each payment document lines of only one particular joint payee vendor; the system shows this joint payee vendor in the Joint Payee Name box in the Summary area of the form. Project Budget Forecasts: Generation of Periods

For a forecast revision selected on the Project Budget Forecast (PM209600) form, you can make the system automatically add financial periods for all the project budget lines listed in the table according to the selection criteria specified in the Selection area. When you click Generate Periods on the form toolbar, for each line listed in the table, the system adds periods of the master calendar in the range of periods that it selects as follows:

As the starting financial period of the range, the system selects the earliest of the following periods, subject to the additional conditions specified:
The financial period to which the Planned Start Date of the project task, which has been specified on the Project Tasks (PM302000) form, belongs.
The earliest financial period to which actual amounts, including amounts of unreleased transactions, or change order amounts of the budget lines related to the project task belong.
The financial period to which the Start Date of the project task, which has been specified on the Tasks tab of the Projects (PM301000) form, belongs. This option is applicable only if no planned start date is found for the project task and no actual or change order amount has been posted for the project budget lines related to the project task.
The financial period to which the Start Date of the project, which has been specified on the Summary tab of the Projects form, belongs. This option is applicable only if no start date is found for the project task.
As the ending financial period of the range, the system selects the latest of the following periods:
The financial period to which the Planned End Date of the project task, which has been specified on the Project Tasks form, belongs
The latest financial period to which actual amounts, including amounts of unreleased transactions, or change order amounts of the budget lines related to the project task belong Each financial period added for a project budget line of the forecast revision has quantities and amounts of zero.

Project Budget Forecasts: Related Reports and Inquiries

In the following sections, you can find details about the reports and inquiry forms you may want to review to gather information about project budget forecasts.

Navigating to the Last Modified Revision of the Budget Forecast

You can navigate to the last modified revision of the budget forecast of the project by clicking Project Budget Forecast on the More menu of the Projects (PM301000) form. The system opens the last modified revision of the project budget forecast on the Project Budget Forecast (PM209600) form. If the project has no budget forecast, a new budget forecast revision is created for the project.

Printing of a Budget Forecast Revision

You can print a budget forecast revision by clicking Print on the More menu of the Project Budget Forecast (PM209600) form. The system opens the printable form of the budget forecast on the Project Budget Forecast by Month (PJ629600) form. Additional Materials | 145

Overhead in the Project Budget: Generated Transactions

When you allocate projects, the system creates allocation transactions based on the settings of the allocation rules associated with the project tasks. Depending on the settings of the allocation rules and project tasks, the system can also create reversing allocation transactions. These transactions are described in the following sections.

Allocation Transactions Generated on the Allocation of a Project

When a project is allocated, the system generates a batch of allocation transactions shown in the table below. The system assigns the Allocation for description to the generated batch. The system uses the following account groups as the source accounts in the batch it creates:

The debit account group, which is specified in the Account Group box on the Allocation Settings tab (Debit Transaction section) of the Allocation Rules (PM207500) form.
The credit account group, which is specified in the Account Group box on the Allocation Settings tab (Credit Transaction section) of the Allocation Rules form.
Debit Account Group Credit Account Group Source of Account Orig. Doc Type
Debit account group Empty Allocation rule Allocation
You can review the created allocation transactions on the Project Transaction Details (PM401000) form. In the Selection area of this form, you select the project in the Project box. In the table, the allocation transactions have the Allocation type in the Orig. Doc. Type column. You can review only allocation transactions on the Allocation Transactions tab.