When a time recording entry is created, it is possible to record the internal cost associated with that time. The internal cost represents the time recorder's wage, rather than their charge-out rate. Recording it alongside the charge out value lets a firm report on the profitability of work.
Create the Rate Card
An internal cost rate card will likely already exist on your database.
- Navigate to Modeller > Global Features > Finance.
- Enable Goods & Services, then select the settings cog.
- Create an Internal Cost Rate.
- You must ensure the item type category is set to be an internal cost rate item.
- Save & Close.
Internal cost global feature
The Time - Internal Cost feature, located in Modeller > Global Features > Finance, must be enabled in order for the internal cost to be captured when time recording.
Pre-requisites: Enable the Chart of Accounts global feature first. Time - Internal Costs depends on it and will not validate without it. You also need a Goods and Services rate card whose item type category is set to an internal cost rate item.
- Navigate to Modeller > Global Features > Finance.
- Enable Time - Internal Costs, then select the settings cog.
- Set a default internal hourly rate for every enabled currency.
The default rates are used for any user for which an internal rate has been created. The internal cost rates are configured via a rate card, which internal rate card to use is configured within this area.
- Select the internal cost rate card.
- When time is recorded, the internal cost is recorded as a transaction in the chart of accounts. Set the account the transaction posts to and map each of the four time statuses to a transaction status.
- Save & Close.
Create rates for internal costs
Once an internal rate card has been created, the cost rates for each job role need to be configured.
The internal costs rates are determined by a users job role. For example:
- a partner's internal cost = £250.00 per hour
- a trainee = £50.00 per hour
Optionally, a firm may also choose to create rates for specific people. For example: Wendy is a partner, the default rate for a partner is £250.00 but the rate for Wendy is £285.00 an hour.
For the user specific rates to be valid, they must be configured against the correct job role for the user, i.e. if Wendy's job role was not a partner than the rate record below would not be applied.
- Navigate to Admin > Finance > Internal Costs.
- Select Add Item > Internal Cost Record or click on an internal cost record to edit it.
- Complete the Item Details.
- To add the rates click + in Pricing
|
Default Rate  |
Individual Person Rate  |
Rate for different Jurisdictions  |
- All rates then display in pricing:
- Save & Close.
How a rate is chosen
Once rates have been configured, any time recording records the internal cost in the Chart of Accounts.
Rates are resolved by job role first, then narrowed by person and jurisdiction. The default rate is the fallback.
| Order | Match | Used when |
|---|---|---|
| 1 | Person and jurisdiction | A rate exists for that person in that jurisdiction. |
| 2 | Person | A rate exists for that person with no jurisdiction. |
| 3 | Jurisdiction | A rate exists for the jurisdiction with no person. |
| 4 | Default rate | No job role rate is matched for the user. |
Job role is resolved at the entry's start time.
Adding a person specific rate for one partner overrides the partner default for that person only.
Who can see internal costs
Internal costs are sensitive. Visibility is controlled by the Time internal costs - Read permission, which applies to time queries, time entry list views and financial transaction list views.
As the internal cost is a sensitive information, whether internal costs are visual to a user is controlled via Time Recording Permissions.
