Overview

When a time recording entry is created in ShareDo, it is possible to record the internal cost of that time. The internal cost represents the time recorder's wage, rather than their charge-out rate.

Recording internal costs against each time entry allows for more accurate and meaningful profitability analysis at a granular level.

The Time - Internal Cost feature, located in Modeller > Global Features > Finance, must be enabled to capture internal costs during time recording. 

Configuring the Feature

Default Internal Cost Rates

Within the global feature, Default Internal Cost Rates can be configured per active currency with a Unit of Measure (UoM). The default rates will be used for any user for whom an internal rate has been created.

The internal cost rates are configured via a Rate Card, and the specific internal rate card to use is configured within this area.

Creating a new Internal Cost Rate card

Please note that an Internal Cost rate card is likely already in place in the system. However, should you wish to create a new one. You can do so from the Goods and Services global feature. You must ensure that the Item Type Category is set to Internal Cost Rate Item. 

For more information on the Goods and Services global feature, see the article Understanding Goods and Services.

 

Configuring Account Transactions

When time is recorded, the internal cost will be recorded as a transaction in the Chart of Accounts. The account type, category, and code to which the transaction should be posted is set within the Account Transactions section of the Time - Internal Cost feature. You also set the equivalent posting status in the Financial Transactions State for each of the Time States.

Managing Internal Costs

Once an internal rate card has been selected, the rates for that type are configured in Admin > Finance > Internal Costs.

A user’s job role determines their Internal Costs rate. For example, a partner's internal cost might be set at £80.00 per hour, while a trainee could be £20.00 per hour.

In some cases, firms may choose to set a custom rate for specific individuals. For instance, although the standard rate for partners is £80.00 per hour, Wendy, who is a partner, may have a personalised rate of £82.00 per hour.

As shown in the Rate Record screenshot below, all partners would usually be assigned the default rate of £80.00. However, because Wendy has a specific rate set up, her time will be recorded at £82.00 instead.

Important: User-specific rates only apply if the user’s job role matches the one selected in the Rate Record. If Wendy’s job role wasn’t set to “Partner”, this rate wouldn’t be used.

Once the rates are configured, any time recording will capture the Internal Cost in the Chart of Accounts.

Please note that, since internal cost is sensitive information, whether a user can see internal costs is controlled through permissions.