09

Implementing Labor Costing

Copyright 2010, Oracle. All rights reserved.

Objectives

After completing this lesson, you should be able to do the

following:
Explain how Oracle Project Costing determines labor costs
Define labor costing rules and labor cost overrides

9-2

Copyright 2010, Oracle. All rights reserved.

Agenda

9-3

Labor Costing Definition

Listings

Copyright 2010, Oracle. All rights reserved.

Labor Costing Implementation Steps

Step

Required?

Setup Level

Define labor costing multipliers

No

Operating Unit

Define labor costing rules

Yes

Operating Unit

Define cost rate schedules

No

Operating Unit

Assign costing rules and rate schedules

Yes

Operating Unit

Define labor costing overrides

Implement labor costing extension

No
No

Operating Unit
Site

Implement labor transaction extension

No

Site

Implement overtime processing

No

Site

Implement overtime calculation extension

No

Site

Labor Costing Implementation Steps

9-4

Copyright 2010, Oracle. All rights reserved.

Define Labor Costing Multipliers

Name

Multiplier

Double Time

1.0

Time and Half

0.5

Uncompensated OT

-1.0

Example: Set of labor costing multipliers

9-5

Copyright 2010, Oracle. All rights reserved.

Quiz
Labor cost multiplier is the value by which Oracle Projects
multiplies an employees labor cost rate to calculate
employees overtime premium cost rate.
a. True
b. False

9-6

Copyright 2010, Oracle. All rights reserved.

Labor Costing Rules

Labor Costing Rule

Overtime Cost
Multipliers:

Costing Method
Rates or Extension

Expenditure Type
Labor Cost Multiplier
Defaults for Overtime Entry:
Project
Task
Components of a labor costing rule

9-7

Copyright 2010, Oracle. All rights reserved.

Quiz
Which of the following are components of a labor costing rule?
a. Revenue categories
b. Overtime cost multipliers
c. Costing method
d. Cost base

9-8

Copyright 2010, Oracle. All rights reserved.

Rate Schedules
Maintain cost rate
schedules by
employee

Donald Gray =
73.50

Maintain cost rate

schedules by job

ENG400.Engineer
= 128.00

Maintain cost rate schedules to calculate labor costs.

9-9

Copyright 2010, Oracle. All rights reserved.

Assign Costing Rules and Rate Schedules

Labor costing rule

Cost rate schedule
Assign costing
rules and rate
schedules

Default job schedule

Defaults values for overtime
transactions
Currency conversion
attributes

Components of an organization labor costing rule

9 - 10

Copyright 2010, Oracle. All rights reserved.

Labor Costing Overrides

Override Labor Costing by Employee

Employee Name: Donald Gray

Costing Rule: Exempt
Override Type: Rate
Rate: 65
Currency: USD

Optionally, you can define labor costing overrides by employee.

9 - 11

Copyright 2010, Oracle. All rights reserved.

Labor Costing Extension

Enter timecard and approve
Process expenditure items

Use extension?

Yes

Labor
Costing
Extension

No
Calculate raw cost
(Without using extension)
Raw cost

Labor costing extension flow

9 - 12

Copyright 2010, Oracle. All rights reserved.

Labor Transaction Extension

Enter timecard and approve

Process expenditure items

Calculate raw cost

Labor
Transaction
Extension

Raw cost - original and

related transactions

Create related
transaction

Labor transaction extension flow

9 - 13

Copyright 2010, Oracle. All rights reserved.

Implement Overtime Processing

Charge labor cost to

projects

Collect overtime
premium cost on
overtime projects

You can implement overtime processing

to collect overtime premium cost.

9 - 14

Copyright 2010, Oracle. All rights reserved.

Overtime Calculation Extension

Enter timecard and approve
No
Calculate raw cost

Use extension?

Processing
does not use
extension

Yes
Overtime
Calculation
Extension
Regular labor cost
on charged project

Overtime premium
transactions on
overtime project

Overtime calculation extension flow

9 - 15

Copyright 2010, Oracle. All rights reserved.

Process
expenditure
items

Quiz
If you implement overtime processing, then you need to define
at least one overtime expenditure type?
a. True
b. False

9 - 16

Copyright 2010, Oracle. All rights reserved.

Agenda

9 - 17

Labor Costing Definition

Listings

Copyright 2010, Oracle. All rights reserved.

Listings
Use the following concurrent processes to document Labor
Costing setup information:
IMP: Labor Cost Multipliers
IMP: Labor Cost Rates Listing
IMP: Labor Cost Rates Listing by Organization
IMP: Labor Costing Rules Listing

Use the listing to review labor cost setup information.

9 - 18

Copyright 2010, Oracle. All rights reserved.

Summary
In this lesson, you should have learned how to:
Implement labor costing
Explain the options for determining labor costs

9 - 19

Copyright 2010, Oracle. All rights reserved.