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Cost coding of activities?

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Bo Johnsen
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Do anybody out there have any tips, tricks, traps, ”do/don’t”, suggestions, comments, etc. when setting up / applying cost codes to your activities in the programmes.


Best regards,

Bo

Replies

Theresa Lim
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Hi everyone,

Im new in Microsoft Project.

I face problem to inside/add costing to Microsoft Project. Can someone assist me to do it?

 

Best regards,

Theresa

Rafael Davila
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Rashid,

Be cautious about activities spanning more than one billing period, a milestone won’t do it as you do not know when it will or will not happen. I believe a calendar driven level of effort activity with appropiate lag can be the equivalent and most probably can work. The key is on the calendars. This all software should be able to model, not sure all can handle multi-constraining when not only resources but financial and materials constraints must also be taken into consideration.

Because it would be wrong to assume cash flow is to be computed from an Optimistic Early Start Schedule it should be computed as a statistic. Perhaps using Monte Carlo or Risk Analysis by Spider Project can give you the probabilistic distribution for NPV. Using Monte Carlo and manually applying NPV to each simulation cycle can be a daunting task.

NPV Cash Flow

For illustration purposes the following screen capture of a model usign 10% Discount/year computed monthly, can show you how easy it is to apply NPV to your model.

DCF

Best regards,
Rafael
Rodel Marasigan
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Rashid,

There are two ways to deal this scenario. It’s either setup a milestone payment using expenses function or calendar driven level of effort activities which ever is appropriate for the task. Both approach are very useful and can flag the payment due.

Hope this answer your query.

Best Regards,
Rodel
Rafael Davila
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Rashid,

Cash Flow

Here I am modeling the payment receipts by the end of the month of monthly payment application. You issue your bill by the first week of next month and by the end of this next month you receive your payment.

Because I was using last day of month an extra calendar exception was needed for leap years.

It is just a matter of calendars, hammock activities to get a group of activities or a single hammock tied to a single activity all with the appropriate lags.

Vladimir can give you the details on how to get the financials such as NPV and Modified Internal Rate of Return, old IRR is available but not sure how it would handle the possibility of 2 values being a quadratic equation, one of which is to be rejected. Whatever I learned of financial ratios was 30 years ago and for this lesson I was cutting classes.

You can hide very easily the offset cash flow activities by using multiple WBS but in any case when checking your model you want them to be visible and not hidden on an invisible field.

Best Regards,
Rafael
Rashid Iqbal
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And a last question….

For cost purposes when you are creating a cash flow…you have cash inflows (Interim Payment certificates) which is say 90% of the work done (Retention money etc deducted) and will be received after 30 days (offset of one month)
You have Cash out flows…which has lag or lead to actual work performed. Earthwork performed in Jan 2010 by subcontractor is 6000 m3..Payment is 18,000. The work will be progressed in the same month though the payment will be made when we will receive the payment that is say 45 days.
Can all such ‘offsets’ are easily managed in P5. Thanks.

Rodel and Vladimir..you guys can write a book on that..when you do it I will buy one. thanks.

r

Rafael Davila
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Isn’t it better to use a Document Manager that can take of whatever you throw at it rather than Minnie Mouse application Primavera Contract Manager? Because of the track record we experienced with Expedition versions 8 and 9 even when it became a true web application many years ago I would not even venture to explore it again. I am talking by own experience not by mouth of others.

I would rather consider Proliance by Meridian

http://www.meridiansystems.com/proliance-software-overview.asp

The problem is either they come with their own Minnie Mouse Scheduling software or use lower end products such as MS Project or a Bug such as P6. There is never full happiness. If you know of an open application that does this without pushing their accounting and/or scheduling software let me know.

You should be able to drop your project files, no matter what format, if can be saved on a windows computer can be saved on a windows document manager. Then using a free File viewer from each software everyone should be able to open an view the job and portfolio files. Everyone who wishes will be included.
Rodel Marasigan
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Thanks Vladimir,
Almost the same process I did managing subcontract in P6. I still prepared using Job Costing for that purpose.
Thanks again.

Best Regards,
Rodel
It is possible to enter payments as milestone activities and manage contract cash flow. But the amounts paid shall be entered manually.
Best Regards,
Vladimir
Rodel Marasigan
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Thanks Vladimir,
Does Spider Project have a capability of Managing Subcontracts too such as progress payment, invoicing and variations? That would be helpful if possible.

Best Regards,
Rodel
Spider Project as any other PM system works with the reports that are not necessarily based on the documents that are valid for accounting. But it can produce reports that are helpful to compare Spider data with accounting data and analyze if there are differences.
Best Regards,
Vladimir
Rodel Marasigan
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Hi Vladimir,
Thanks for the info.
Correct me if I’m wrong. My understanding is Spider Project can handle Job Costing itself (not accounting system). Wow that’s a very good system. I’m impressed.

Best Regards,
Rodel
Hi,
in Spider Project it is possible to create any number of cost components and assign them to activities, resources, assignments, materials.
Cost may be assigned as fixed quantity, per hour, per volume unit.
Grouping several cost components it is possible to create cost centers that show cumulative costs by selected cost components. The number of cost centers is also unlimited as everything else in Spider Project. Some cost components may depend on others and are calculated by user defined formulae.
Different cost components may have different unit cost (that can be interpreted as exchange rate if to use many currencies).
It is possible to manage several budgets in parallel creating corresponding cost centers. So the same activity may have several parallel costs (direct cost, total cost, contract cost, etc.).
It is possible to simulate incomes and financing.
It is possible to calculate project schedule with financial (cost) restrictions (cost leveling).
It is possible to manage financial realationships with subcontractors (simulate payments and get the information who owes to whom what money at any moment).
It is possible to apply EV to any cost component and cost center.
It is possible to hide selected cost components and cost centers from those who are not authorised to see them.
There is no need in any dummy resource or anything like this.
If there are questions I will be glad to answer.
Best Regards,
Vladimir
Rodel Marasigan
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Hi Rafael,

Yes you can still do that in P6 assigning duplicate Resources with different cost account but the terminology is change and with added functions and multiple variable rates available.
Thanks for the info and I will wait for Vladimir for more information.

Best Regards,
Rodel
Rafael Davila
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Rodel,

In Primavera P3, as far as my memory can recall, we could assign the same resource several times to a single activity this could be named BOQ and then assign different cost amount and different cost code for each assignment (not sure if type was an option), therefore with only a single resource we could assign several cost codes to a single activity. Can you do that in P6?

In SureTrak even without Cost Codes by using a dummy resource for each Cost Code I could mimic the Payment Application Spreadsheet even with unit prices but always ended up entering amount values as to keep decimal digits, in the end I always preferred avoiding the unnecessary steps and enter costs amount directly to cost codes per activity.

In Spider Project you can assign cost amounts and cost codes directly to activity or to individual activity resource but better Vladimir get into it, he is more knowledgeable, I am kind of a rookie with Spider Project as of today I have not performed a single real job full cycle with it. Whatever I say about Spider Project take it with the understanding this is new software to me.

In Spider with the use of foemulae and unlimited user defined fields we can mimic the hole Payment Application Spreadsheet as well.

Best Regards,
Rafael
Rodel Marasigan
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Rashid,
There are big benefits using this process than using Excel to analyze and forecast the data.
First, Planner can analyze cost within the schedule itself and you don’t need double effort by looking at the schedule and excel spreadsheet at the same time.
When there is slippage cost are automatically updated and not to worry if that was captured when reviewing data in Excel.
All done electronically so updating is so simple and easy.
Much accurate Cash Flow and Forecast are produce compare to excel (depends on the level of details).
Very useful in Earned Value Management and reports and graphs/ S-curves are available in just a click of a mouse or run automatic report using Job Services and many more.

Best Regards,
Rodel
Rodel Marasigan
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Vladimir,

Yes you got it. In order to assign cost account into activity you need resource per cost account. In those three options I often use Override rate source or Role rate source at it was not messing up the Resource Breakdown Structure and always can play on the rates when required.
As I mention the setup is depends on what data is available from the Job Costing used and as per project requirements.
For Maintenance, Shut Down and small project usually required detail breakdown per person but for decent size of a Project more often summarize with cost account component. As I mention all indirect are goes to WBS summary or Level of Effort which ever is appropriate to use. Because it was done electronically so the setup will not that hard. Assigning will consume a little bit of time depends on how it was required to track and level of details. Updating is very easy because all done electronically. Forecasting and analyzing cost is also easy and done together with the PM and PCM.

The process is very useful for managing cost, cash flow, forecasting and EVM.

Kindly please would you be able to explain how cost account used in Spider Project? I’m interested to know how it was setup, assigned and track. Thank you in advance.

Best Regards,
Rodel
Rafael Davila
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Vladimir,

I believe that in order to cost load an activity in P6 all is needed is a resource using one or many cost codes, that you cannot cost code directly to an activity and therefore a dummy resource must be created as for example to mimic BOQ, in such case you will have to assign that resource to every activity that include BOQ costs and then you can assign multiple cost codes to the dummy resource. In a sense BOQ resource is the equivalent of a Cost Center and needed for reporting BOQ, other cost codes would be assigned and actualized on other resources.

Probably the cost codes in P6 are multi-valued fields with limited predefined components called Types; they have no Cost Centers/Resource Centers/Material Centers. We have single valued per record cost-codes fields we can assign any combination of cost centers. The types might have their origin in our traditional Job Costing practice where we used for each cost code a LEMSO (mnemonic for Labor-Equipment-Materials-Subcontracts-Other) subdivision. This was probably with the intention of integrating the CPM with Job Costing modules.

for example:

http://www.bissoftware.com/pdf/Job%20Cost%20Brochure.pdf

http://www.bissoftware.com/images/popup2.html?JobCostStatus.gif

The following I suppose is a summary report as job costing without quantities is merely budgeting and not of much use when you are interested in unit costing.

http://www.bissoftware.com/WEBSITE/images/popup2.html?JobCostBudget.gif

Volume of work is our living.

In Primavera SureTrak where I had no Cost Components, I had to create a dummy resource for every Cost Code in order to mimic Cost Code details. An option was to create a single dummy resource and work on the detailed cost account distribution on a separate worksheet. I used both approaches. P3 and P6 cost codes provided more functionality than SureTrak while Spider Cost Centers in adittion to Cost Codes add a dimension that makes your reporting and assignment even more versatile.

My prior experience with P6 was when it was in its infancy and named P3e it was used by a Program Manager to create reports for the Local Water Authority, and then we tried P6 and discarded it in our evaluation. As all jobs were separate stand alone contracts the Contractors would submit their schedules in P3 format and we deployed the schedules transferred from P3 files to P3e on the Web using Citrix Metaframe. I wonder if someone else ever looked at it, but we billed for it and made a living out of it. We used P3 and SureTrak for our evaluation of schedules and EOTs as there was never a perfect match between P3 and P3e; P3e(old P6) was for generating reports, no one ever noticed the difference between P3 and P3e files.

I do not have a license of P6 but hope this can be understood if this is how it works, not sure.

Best Regards,
Rafael
Hi Rashid,
I don’t know what Rodel does with costs, but we manage costs.
Managerial decisions, what if evaluations, etc. are estimated by their impact on the future profits.
There may be cost restrictions and creating project schedules we shall take them into account (cost leveling).
So project model shall include all necessary information for decision making including cost information, schedule and budget are integrated.
Best Regards,
Vladimir

Rashid Iqbal
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Rodel,

A simple one line question....

What is the biggest benefit of doing all this cost related stuff in P5 and not in Excel i.e. exporting schedule data and cost data and do an analysis in Excel?

I know you are in discussion with Vladimir take your time in replying me.
Hi Rodel,
So for management of cost components it is necessary to create not one worker but as many as the number of cost components.
Assignibg worker it is necessary not to forget to assign all "workers", created for each cost component.
And the report on worker cost is actually a report on integrated resource (an element of Resource Brealdown Structure) that consists of all artifial "workers".

Rather complicated. The number of cost components used by our customers varies from 30 to more than 100.
The number of project resources shall be very large.

Thank you and Best Regards,
Vladimir
Rodel Marasigan
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Hi Vladimir,
I create a sample exercise to explain to you further using the three different rate options that P6 can use to breakdown the cost account in one activity. I use different rates to identify the difference.
Note: This is just for illustration purposes and should not take literally.

First I create a sample CBS to use. (see below)
Sample CBS

Then I create a sample Resource broken down by cost type and also created a resource role as cost type which I going to use for separate example. (see below)
Resource with roles

1) Using Resource Rate with cost account.
Resource using resource rate

Sample report using resource rate.
Report using resource rate

2) Using Roles Rate with cost account
Resource using roles rate

Sample report using roles rate.
 Report using resource rate

3) Using Override rate with cost account
 Resource using override rate

Sample report using override rate.
 Report using override rate

Using combination of three rates source:
Rate Combination

Using any of the three rate source or combination will came up with the same result. Alternatively P6 has Expenses module that can be used for Fixed Cost distributed equally or One time cost (see below)
Expenses

Hope this will answer on your query and give you clear pictures on how it was done in P6.

Best Regards,
Rodel
Rodel Marasigan
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Hi Vladimir,
Sorry if my explanation is not clear.
First Resource rate is defined in properties.
Roles Rate is define in properties.

When assigning resource to activity planner has option to use any of those define rate plus override option.
This override option will allow the planner to change the define rate and enter the correct rate belong to cost account allocated.

In regards to defining rates, Primavera can also define rate as many as required but can only use one at a time but can change using override option.

Is that making sense?

Best Regards,
Rodel
So this was a problem of terminology.
I will ask my question different way.
Is it possible to define that resource rate consists of rate 1. rate 2, and rate 3 where each rate belongs to different cost component (or account)?
Best Regards,
Vladimir
Rodel Marasigan
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Hi Vladimir,

Resource rate are define in properties and P6 has three rates option to use. Resource, Roles and Override aside from rate1, rate2, rate3 and so on depends on how many rates required when resources are defined which normally used when rates are change due to escalation or any point but rate can be use one at a time depends from date range define.

The Override Option is very useful because once the resource is assigned and allocate a cost account then your can change the rate using override option to match the rate applied on the Cost Account budgets.

Best Regards,
Rodel
Thank you, Rodel.
So, if I understood correctly, P6 does not permit to define resource hourly rate and each time assigning resource I shall again and again enter its cost.
Best Regards,
Vladimir
Rodel Marasigan
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Hi Vladimir,

You Post: is resource cost defined in resource properties?

No, as I have mentioned cost account can only assigned in resource assignment and not on resource properties.

You Post: What if resource cost is the sum of Cost 1, Cost 2, and Cost 3. And in every assignment it is still Cost 1, Cost 2, and Cost 3 in the same proportion? Can I somehow define this in P6?

Yes that what the cost account is for. Planner/user can assigned resource with different cost account and can group by cost account or by resource or WBS or any format required as long the options are define and available for selection.

See sample report group by Resource then by cost account.
Resource by Cost Account

Resource by Cost Account 2

Best Regards,
Rodel

Thank you, Rodel.
But is resource cost defined in resource properties?
What if resource cost is the sum of Cost 1, Cost 2, and Cost 3. And in every assignment it is still Cost 1, Cost 2, and Cost 3 in the same proportion?
Can I somehow define this in P6?
Best Regards,
Vladimir
Rodel Marasigan
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Hi Vladimir,
I’m still not getting it. On my post #12 have example of how resources are define. Then resource being assigned to activities and have their own cost account.

Note: Cost accounts are allocated to resource only when resources are assigned to activities and not when defining resources.

Best Regards,
Rodel
I understood that on Post #16 you showed activity details.
I expected to see resource properties that do not depend on resource assignments.

Best Regards,
Vladimir
Rodel Marasigan
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Sorry Vladimir,
I can’t get what you mean. I just show you a resource consist of multiple accounts on figure attached on Post #16.

Best Regards,
Rodel
No, it is not.
Create any name instead of taxes.
I just want to know how to define that resource cost consists of three cost components and names do not matter.
Best Regards,
Vladimir
Rodel Marasigan
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Vladimir,
As I have said, our job costing doesn’t deal with taxes. We use our budget estimate by cost account to spread into activities in primavera. We are not using primavera as an estimating tool. We use it only on planning, scheduling, cash flow, forecasting, analysis and EVM.

Maybe your system is different from our job costing system. All accounts are deal by accounts department and Cost belong to project is what we care for (Indirect, direct, expenses, consumables etc...).

Here some explanation how it works.
First derived Budget for the Project.
Project Manager, Project Control Manager & Accounts Manager will sit down together to breakdown the Budget to CBS (Cost Account) and WBS.
Then enter all those cost to job costing system per CBS.

For indirect like staff (all cost inclusive-i.e. tax, allowance, super, car if included on the package). Accommodation, travel, expenses, Car pool, etc… are separate and have their own cost account.
For direct wages (all inclusive i.e. levy, allowances, working at height, super, taxes, travel, expenses)

CBS are mirror to Primavera and allocate the budgets per cost account to activity.
Then we progress the activity.
On Cut-off, Job Costing will download the monthly actual cost including accruals and upload to primavera.

Is that what you’re asking?

Best Regards,
Rodel
Rodel,
it is too complicated to me.

My question is very simple:
How to define that the hour cost of the resource worker consists of his salary ($25/hour), taxes that will be paid for his salary ($10/hour), and indirect cost that is calculated as the percent of his salary (80%).
Just this, nothing else please.

Best Regards,
Vladimir

I suggested different case when activity was extended but did not delay the last and summary activities. But let’s discuss this later. Please answer my question on resource cost components.
Rodel Marasigan
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Rodel

Vladimir,
We are doing the same thing and summarize Project cost per CBS or WBS or any layout required. WBS summary activity is an activity. It follows what ever the duration under that WBS means running from start of first activity across to the last activity. If the activity extend then WBS activity also extend vice versa.

Resource are define per cost type (see sample on my previous post) then assign a cost account. Primavera has also an option to use same resource with different cost account. Primavera can add same resource as many as required on the same activity with different cost account assignment and different timing, duration, rate and start/finish date. (See sample below)
Multiple Resource

Best Regards,
Rodel
We calculate project cost as the sum of activity costs and eachactivity costs is a sum of resource costs, material costs and costs assigned directly to activities. If the schedule will change then the cost distribution (project budget) will change even if the summary bar will not move. If activity will be performed longer it will mean additional expenses that is hard to calculate if the costs was defined separately.
Indirect costs is usually calculated as the percent of direct costs and cannot be assigned separately also.

I did not receive an answer to my very simple question:

How to define that one resource cost consists of cost components (for example - salary, taxes, indirect cost)?
Please answer.

Best Regards,
Vladimir
Rodel Marasigan
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Vladimir,
Not all cost is necessarily assigned to each activity. It is a good practice to have its own activity per cost account but in general practice it is impossible that is why we used WBS summary or Level of Effort, depends which of the two is appropriate.

Ex: WBS summary for Construction
We all know that Indirect such us staff salaries, expenses… etc… are running parallel with construction but it may have different start & finish date. As I explain on my post Primavera can change the planned start & finish date of each resource sitting on one activity such as WBS summary activity and forecast are also done using future buckets.
All activities under construction WBS summary have their own resources with assign cost account as posted on my previous post.

Is that explained your query?
Best Regards,
Rodel
Hi Rodel,
let’s do it step by step.
How to define that resource cost consists of cost components?

For project cash flow management it is necessary to include indirect costs, taxes, etc.
Costs shall be assigned to resources and activities and not to WBS summaries if you want to manage costs.

Please answer this first question.

Best Regards,
Vladimir
Rodel Marasigan
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Hi Vladimir,
First our Job Costing doesn’t deals with taxes, GST and VAT and taken care of accounting department.

All Salaries, indirect cost… etc are assigned in WBS summary depends on which WBS it needs to sit.

Some Projects may require resource breakdown by roles or by name depends on the size of the Project and its requirements (See below)
Resource

Sorry I don’t understand the query on second paragraph. Cost Account is just an element of CBS which is assigned in resource not activity but resource is assigned in activity. See sample below.
Resource Alloc

For Level of effort depends of which activities is for. (see above sample)

Sample Cost Account Breakdown
Cost Account

Best Regards,
Rodel
Hi Rodel,
please explain how to define in P6 that resource cost consists of salary, taxes, indirect cost and other cost components. Just for an example.

I don’t understand your options. I have thought that activity cost consists of the costs of the work of allocated resources, materials that are needed for activity execution and consumed by assigned resources and additional cost that may be assigned directly to activity. What do you mean by assigning cost account if activity already belongs to some element of CBS?

If you create LOE activity that lasts from the start of the first activity to the finish of the last activty what resource do you suggest to allocate?

Please clarify and better with the examples.

Best Regards,
Vladimir

Rashid Iqbal
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Rodel,

Good one... I was asked once but was able to negotiate my way out by proposing that the schedule data and cost will be married in Excel.

Rodel, the thing which you have been doing in terms of cost and schedule intergation deserves a techincal paper. I have read a few but most of the authors just talk about 6 activties example schedule.

regards
R






Rodel Marasigan
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Rashid,
All CBS cost account are breakdown per account type like, Salary, labor, plant & equipment (internal/ external), tools, consumables, subcontractor, materials, expenses…etc… which represented by resources. Each Resource is allocated to activity and each CBS are assigned to resource.

Having CBS in 3 different activities not sitting in same WBS is not a problem in Primavera. There are two options to deal with this scenario.

Option 1: Breakdown the cost to each activity if activities have big gap to each other then allocate the resource and assign cost account.

Option 2: If activities are continues but not sitting on same WBS we use Level of Effort activity link SS to SS on the first activity and FF to FF to last activity then allocate resource and assign cost account to spread the cost.

If multiple Cost Account has been allocated to one activity which normally happen, (i.e. labor, equipment, tools, expenses and material…etc…) Primavera has a capability of assigning multiple resource (cost type) and cost account.

There are also some scenario where multiple resources (cost type) sitting on one activities but having different durations and start date which can easily adjust in Primavera by adjusting the planned start and finish date of each resources. Primavera has also a capability of adjusting the forecast on each resource with different timing which we called future bucketing.

We all know that most of accounting process is late but it depends on how it is being managed. Our system has a mandatory cut-off date which every team goals is to meet that standard which sometimes cannot avoided.
Every responsible person on each cost account has to process all job cost and estimate all those cost that they aware need to be included or coming. (We call these accruals). These processes are good in cash flow, cost forecast, trending and EVM.

Best Regards,
Rodel
Rashid,
you asked vwery good question.
We use not just costs and cost accounts but also cost components. Each item (activity, resource, assignment) has cost, consisting of cost components.
Activity cost may consist of labour cost, cost of machines, cost of materials, indirect costs, etc.
Cost Breakdown structure may show cost accounts but it is not enough.
If an activity is done by several resources it is hard to refer all expenses to one cost account.
An example - the crane that is used may be an external resource, other resources may be internal or belonging to different company. So expenses on this activity refer to several cost accounts.
In any case it is not enough to get cost accounts reports, it is necessary to know what is labour expenses, material expenses, indirect costs, etc.
Cost structures and any activity structure are different.

I would not mix cost management in projects with accounting. We make decisions basing on management reports, not on accounting reports. From time to time it is necessary to compare the results but it is impossible to manage resources basing only on accounting data that are always late.

Best Regards,
Vladimir
Bo Johnsen
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Rodel, Rafael et al,

Thank your very much for the answers.

Regards,

Bo
Rashid Iqbal
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Rodel,

Buddy your knowledge of these softwares should be appreciated...you have not left any doubt everything explained to nuts and bolts.

Would you comment a bit more on..

"What will happen when an item in CBS is divided into three activties in different WBSs and also what will happen if it is other way around i.e. one tasks is having multiple CBS items?"

Regards
R
Rodel Marasigan
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Bo Johnsen,

It depends on the planning software you are using and the process of updating actual cost in regards to cost accounts.

I’m using Primavera (p3 to p6) and successfully integrated our Job Costing software such as (Workbench, Sun System, Job Pac, Pronto, SAP, MYOB etc… depends of what system used on each project I’m involved with) but different approach on each and defend on what sort of data you can get from those system. Typically all Job Costing system can export a job costing transaction per cost accounts but all of them have different format and fields which normally export text file or csv format.

The best approach is to mirror Job costing Cost Breakdown Structure (CBS) to planning software cost accounts. (It is easier to assign cost account if WBS is something similar to CBS or as close as possible but not mandatory as long as cost account is feasible to assign)

P3 is using Btrieve transactional database and can easily access using ODBC to input data automatically using external database (API) or in-house modification from Job Costing software (tailor to suit by the programmer/ software developer).
Majority on my case is using external database (API) to integrate both planning software and job costing software as a middle communication medium (export/import).

P6 are using SQL or Oracle which is an open database and can easily integrate using API or even tailor to suit by Job costing maintenance programmer into the system.
Same approach using external database (API) but direct link to Primavera database tables and update is just a press of a button every cut-off date.

It is still possible to update P3 or P6 automatically using import/export function to excel.
For P3 users here are some tips.
P3 has a limited character (max 12) which may not reflect the full cost account of some job costing software. P3 also don’t have a capability of having tree structure which is now very popular on majority of job costing system.
So the trick is to have a separate lookup table to match the cost account codes to P3 cost codes. When exporting a excel template (wk*) or (dbf) make sure all code fields are present such as cost type, cost code, resource id. If any of these are missing P3 will not update the existing resource assignment and treat it as a new resource so it will end up to adding same resource with new cost type and or cost codes.

For P6 Users
P6 can mirror exact cost account code from any job costing including tree structure but if using excel import/export function avoid using tree structure if possible. The reason is cost account element can be duplicated on a separate tree level and import function will not exported all element unless the user is using SDK, ODBC or API. P6 will just add a new resource assignment and will not update the existing because the first cost account on the duplicate cost account ID will be use which might not be the correct cost account. Same as P3 all fields such as roles, cost code, resource id, cost type much be exported on the template otherwise when import back it will not update the existing and create a new resource assignment. Assigned all continues cost and indirect cost account to WBS summary such as (staff salary, expenses, utilities, office cost, consumables, plant hire, flights, etc…) to limit resource assignment unless it is require.

Best Regards,
Rodel
Rafael Davila
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Joined: 1 Mar 2004
Posts: 5229
Rashid,

Cost Accounting if conformed to General Ledger and done through the Subsidiary Ledgers such as Purchase Orders and Payroll it can be very powerful, precise and auditable. Given no choice I would go for the traditional Job Costing method using the Financial Software.

But if you are given the opportunity to have both this is even better. Then you will get a better view of time element, cash flow prediction and trends. The problem is how to integrate both tools. I would never let my Financial Software decide on my Scheduling Software or vice versa.

For the Job Costing we use our own tailored coding based on Master-format. For the Schedules we use BOQ particular of each job as every Owner requires its own particular coding. We have never integrated the Job Costing with our Scheduling software but is never ruled out. Is a matter of choice, our Financial System even when provides its own Scheduling software it is not our choice nor the choice of the Owners who very frequently require us to use other software as if a change of underwear.

In the Construction business I do not see acceptance to the integration as long as Owners insist in their own particular choice. We have been required to use SureTrack on a Navy Job and on Public School construction jobs, we have been required to use use P3 on a Potable Water Treatment Plant and MS Project on a couple of housing jobs. A few months ago we were required to quote using Web based software called Prolog by Meridian. Fruit of the Loom software is on the waiting line.

Best Regards,
Rafael
Rashid Iqbal
User offline. Last seen 1 year 35 weeks ago. Offline
Joined: 7 Apr 2010
Posts: 70
Guys,

I have attempted something like that years before myself....

do you think that making the scheduling engine behave like a Cost Control system is asking a ’little’ more. Thanks.

Best Regards
r




R. Catalan
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Joined: 15 Aug 2005
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Dear Bo Johnsen,

Use CSI/Masterformat standard coding and use your cost codes to mirror BOQ structure with your programme. This is very useful when comparing earned value in programme vs your payment application.

Some contracts requires a printout of the current monthly update of the programme as the basis for payment application.

Best regards,

R. Catalan