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9 Replies Latest reply: Nov 6, 2012 9:02 AM by oracle_samba RSS

How to derive/generate Revenue only wth Project costing?Burdening possible?

oracle_samba Newbie
Currently Being Moderated
Hello Experts / Dina,

I am doing a implementation to customer where only Project costing is in scope and customer wanted to derive / generate revenue for few of the revenue generated project using oracle project costing. Currently this customer is using legacy external application to enter manual journal for revenue.

So can you please provide me workaround to achieve only revenue generation using oracle project costing?

I have one workaround but wanted to validate from you all experts. Plz help me...

1. Enabling budening on same expenditure item I can generate revenue using burden schedule and setup total burden cost db and cost cr account in auto accounting so that burdent Cost Crd account will be a reveue account and burden Cost dbt account will be UBR a/c. and then transfer the burden cost to GL as revenue vs UBR.

This work around is thorotical and dont know what is implication of burden mulitpliers. If I used this workaorund then revenue (burden cost) amount is depend upon the expenditure orgnization multiplier and not on job based or employee based. How to solve this problem?

I think there is possibility to drive the burden multiplier based on expenditure types..if taken that approch then end up in creating lot of expenditure type for each multiplier.

So please help with workaround or someother method.

Thanks
  • 1. Re: How to derive/generate Revenue only wth Project costing?Burdening possible?
    oracle_samba Newbie
    Currently Being Moderated
    Hello,

    Any help on this will be really appreciated.

    Please help.

    Thanks
  • 2. Re: How to derive/generate Revenue only wth Project costing?Burdening possible?
    oracle_samba Newbie
    Currently Being Moderated
    Hello

    Any Luck on this?

    Thanks
  • 4. Re: How to derive/generate Revenue only wth Project costing?Burdening possible?
    Dina Rotem Guru
    Currently Being Moderated
    Hi

    The approach of using Total Burden Costs for revenue generation might work. I assume you will invoice through AR. So notice that the UBE&UER balance will not be managed by Oracle Projects. The issue of revenue amount per job or employee is not easy to solve.

    There is another option to get the same results as the burdening, but with easier solution. You could take the approach of using cross charge functionality. This is available with Project Costing. If you don't have multiple operating unit you could stay with Borrow and Lent as a simple solution. For that you will need to set up one organization as the owning of the org of the projects, while all resource organizations will be different. The accounting could be credit of revenue and debit of UBR.
    The cross charge has more flexible methods of calculating the amount per expenditure item, and that may help you acheive you goals. Look at the Transfer Price Client Extension as a possible solution.

    Dina
  • 5. Re: How to derive/generate Revenue only wth Project costing?Burdening possible?
    oracle_samba Newbie
    Currently Being Moderated
    Hi Dina,

    First of all many many thanks for posting your answer on this question.

    1. > I tried using total burden schedule approch to generate revenue but I think there is problem to restrict the accounting for the expenditur items which should not be burden ( need not to be generate revenue). As Total burdening approch creates burden accounting as raw cost though burden mulitplier is not specified ( system takes as value 0) :(

    2.> Then I tried a approch of using create & distribute burdening method ( burdening on separate expenditure item) - This works fine and generate burden accounting ( revenue a/c -& UBR). And provides a restriction of generating revenue on selected expenditure items based on burden schedule schedule (multiplier as 0 not specified). On Expenditre Inquiry also can reports a revenue after querying on Expenditure Type Class as "Burden Transactions". You can also reverse items and reverse costing / burdening ( reveneu ) with normal standard process.

    3.> If I wanted to use borrowed and Lent processing then I guess it will be easy. But only problem is I can't keep Project Org as Resource Org. Then there is pain in defining lot of resource organization and project organization ( I m not sure customer will agree :() . Also after referring the Project API guide I am still confuse about 2 diff extention doing same thing.
    a.> Transfer Price Determination Extension b.> Transfer Price Override Extension . Can you please explain what is difference between both of them and wat is purpose for both of them?

    Also In case i don't used the extension then I will be left only using Transfer price % ( 100% + ) to derive my revenue price? rght? Also I am not sure how can customer will have restrictions on the expenditure items which should not generate revenue? ( By defining another transfer price schedule on the selected TASKS with rule as transfer price % 0? )

    and I hope by using borrowed and lent processing I can do adjustments ( like reversing of revenue ) as standard way?

    Please guide.

    Thanks a ton !!!

    Cheers,
    :-)
  • 6. Re: How to derive/generate Revenue only wth Project costing?Burdening possible?
    Dina Rotem Guru
    Currently Being Moderated
    Hi


    1. > With Total Burden Cost all actual raw cost will drive revenue, even of multiplier is zero. So if you need to leave some expenditures as not billable this is not a good approach for you.

    2.> The use of burden on separate expenditures will indeed do the work. However, if you use burden items for revenue you may restrict the use of real cost burden in the future. It is not absolute restriction since you can assign additional burden codes for cost burden. However, consider that when thinking about reporting.

    3.> For borrowed and Lent processing. Look at client extension - Provider and Receiver override extension. Package PA_CC_IDENT_CLIENT_EXTN, PAACCIXTS.pls. This will allow you to modify for each expenditure item who is the receiver organization and who is the provider organization.
    Consider also the client extension - Cross Charge processing method override extension. Package PA_CC_IDENT_CLIENT_EXTN, PACCIXTS.pls, which you can use to determine for each expenditure item if it will generate a cross charge transaction or not at all.
    If you reverse or adjust the raw cost expenditures, the borrow and lent will be calculated again and generate adjustment transactions.

    Dina
  • 7. Re: How to derive/generate Revenue only wth Project costing?Burdening possible?
    oracle_samba Newbie
    Currently Being Moderated
    Hi Dina,

    Thanks for update.

    Your information is really helpful.

    But still I am not clear about the two Extension. 1)Transfer Price Determination Extension and 2.)Transfer Price Override Extension.

    Can you please elaborate this if possible with example?

    Thanks
    :-)
  • 8. Re: How to derive/generate Revenue only wth Project costing?Burdening possible?
    Dina Rotem Guru
    Currently Being Moderated
    Hi

    The case is you have set up the cross charge selecting the Transfer Price method.
    A) The extension - Transfer Price Determination Extension
    The Distribute Borrowed and Lent Amounts and the Generate Intercompany Invoice processes call this extension, before calling the standard transfer price determination routine. If the extension returns a value the process will use the value and will not use the calculation based on setup rule.

    B) The Extension - Transfer Price Override Extension
    The Distribute Borrowed and Lent Amounts and the Generate Intercompany Invoice processes call this extension, after calling the standard transfer price determination routine. If the extension returns a value the process use that instead of the standard calculated value.

    Extension B is useful if you have a logic that will override the transfer price only if the calculated standard value meets some criteria.
    Extension A is useful if you have a logic that will return a value, independent of the standard rule result.

    Dina
  • 9. Re: How to derive/generate Revenue only wth Project costing?Burdening possible?
    oracle_samba Newbie
    Currently Being Moderated
    Hello Dina,

    Once agian thanks for the detail explaination.

    Regards

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