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Planview Customer Success Center

Use Organizational Rates

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Project Managers can define Budget and Actuals through calculation using Organizational Billing and Cost Rates. In this scenario, Project Managers capture on a task level a project’s budgeted cost and expected revenue and derive actuals from the work plan effort. 

In this scenario, Project Managers created a work plan, estimates, and organizational rates were setup by your administrator. AdaptiveWork will automatically calculate the expected margin, CPI, budget status, other tracking indicator, and Profit values.

The following fields can be automatically calculated as per formula:

  • Budgeted Cost:  Planned Work * Hourly cost Rate
  • Actual Cost: Actual Effort * Hourly Cost Rate
  • Expected Revenue: Planned Work * Hourly billing Rate
  • Actual Revenue: Actual Effort * Hourly billing Rate

 

           

Prerequisites

If you can't configure your organization system settings or set User permissions, contact your administrator to ensure that the following prerequisites are met.

Enabled Global and System settings

  • Enable the system settings 9.1: Budget Management. Defines whether to activate the budget module which enables budgeted cost and actual cost management.
  • Enable the system settings 9.3: Projects are Billable by default. Defines whether projects are billable by default, where revenue fields and variances are calculated.
  • Define the Hourly Cost and billing rates for the organization in the Global settings. It is feeding into our Work Plan budgeted cost and expected revenue based on the Work that you are defining.

User Permissions and Profile

  • Enable the Financial permissions for Users so that they can access financial fields and the financial planning view
  • Ensure the User Profile Property Card includes a Financial section with the following standard fields: 
    • Budgeted Cost, Actual Cost, CPI
    • Expected Revenue, Actual Revenue, RPI
    • Planned Profit, Profit, Earned Value, % Profitability

           

 

To calculate Project Budget and Actuals with Organizational Rates:

  1. Log in as a Project Manager.
  2. From the Project module, open your project and view its details.
  3. Add the Calculate Financials field to the grid and toggle ON at the project level. This will enable the application to run aggregated financials in the background. 
  4. Add the Billable field to the grid and toggle OFF for all work items that shouldn't be included in revenue calculation. Alternatively, you can ask your administrator to uncheck the 9.3 system settings so that you can turn ON only relevant items. 
  5. In the Grid view of your Work Plan, add the Work, Budgeted cost and Expected revenues fields. 
  6. For each Work Item that is billable, add manually a value for the Work column. 

    The budgeted cost (Planned Work * Hourly Cost Rate) and expected revenue (Planned Work * Hourly Billing Rate) are automatically calculated. Note that Budgeted cost and Expected revenues fields rolls up from lowest level to the parent work item.
     
  7. In the Grid view of your Work Plan, add the Actual Effort, % completion, Actual cost, and Actual revenues fields. 
  8. For each Work Item that is billable, add manually a value for the Actual Effort column. Alternatively, you can set the % completion for the Task and the Actual Effort will be derived automatically from your input.  

    The Actual cost (Actual Effort * Hourly Cost Rate) and actual revenue (Actual Effort * Hourly billing Rate) are automatically calculated. Note that Actual cost and Actual revenues fields rolls up from lowest level to the parent work item.

That's it!

AdaptiveWork will calculate automatically CPI, RPI, Planned Profit, Profit, Earned Value, and % Profitability.