This special topic discusses the retroactive billing process. Retroactive billings are needed in order to reissue billings that require rate changes on invoices that have already been posted. The system can calculate retroactive bills for changes in T&M rates or for changes in provisional billing rates on cost-reimbursable projects. Details on the calculation of retroactive bills as well as their printing and posting are also discussed.
During the life of a project, there may be changes in the billing rates that are used on the invoices. Billing rates can be either indirect cost rates or an amount per hour, which are applied to direct cost amounts or hours on "cost-reimbursable" projects, or they can be loaded labor rates, which are multiplied by direct hours on Loaded Labor Rate projects. If a project is a Loaded Labor Rate job with indirect rates burdening non-labor amounts or hours, it will contain both types. Changes in unit prices are excluded from the retroactive billing process.
Some billing rate changes are on a prospective, or going-forward, basis. If the changes are of this nature, they are not considered retroactive and, therefore, you can make the billing rate changes without calculating retroactive bills.
You can make prospective billing rate changes for cost-reimbursable projects by entering the new provisional indirect rates in the Pool Rates subtask of the Cost Pools screen (Projects » Cost and Revenue Processing » Cost Pool Setup). You should enter these new rates in the period in which they take effect. Cost-reimbursable projects are identified by either the Cost Incurred Plus Fee On Cost or Cost Incurred Plus Fee On Hours billing formulas set in the Project Billing Info screen (Projects » Billing » Billing Master or Projects » Project Setup » Revenue Setup). For these project types, the system multiplies transactions residing either in the Open Billing Detail table or posted there after the rate change by the new indirect rates to arrive at the indirect cost amounts. You can show the indirect cost amounts from the new rates on the same billing lines as the original rates, or set up new billing lines for the new rates. Make changes to the billing format in the Accounts subtask of the Generic Billing Formats screen (Projects » Billing » Formats).
For loaded labor rate projects, you can make prospective billing rate changes by entering new loaded labor rates in the Set Up Project Labor Categories (PLC), the Project PLC Rates , or the Project PLC Rates by Employee/Vendor screen (all in Projects » Project Setup » Project Labor), depending on the billing rate method you are using. Loaded labor rate projects are identified by the following billing formulas:
Loaded Labor Rate
Loaded Labor Rate Plus Cost Incurred On Non-labor (T&M)
LLR w/Fee plus Non-Labor w/Burden w/Fee
Loaded Labor Plus Non-labor Plus Burden On Non-labor
Loaded Labor Plus Non-labor W/Burden W/Fee
Labor Cost times Multiplier plus Non-Labor times Multiplier
Rate Schedule times Multiplier plus Non-Labor Cost times Multiplier
Enter new, loaded labor rates by adding a new line to the applicable labor rate table and entering the PLC, the new rate, and the dates on which the new rate should be in effect. Changing any of the loaded labor rates will cause an additional line to appear on the bill for each different PLC rate. If the billing formula applies burden to non-labor, you can change the billing rate for this portion of the bill in the same fashion as for cost-reimbursable projects.
For projects in which the billing rates should take effect retroactively, you can make the changes the same way as for prospective rate changes, with one difference: you must use the Calculate Retroactive Billings screen (Projects » Billing » Calculate Billings) to create a bill for the retroactive portion. The calculation of a retroactive bill produces a regular bill that you can review and edit in the Edit Standard Bills screen (Projects » Billing » Edit Billings). In the Print Retroactive Billing Worksheets screen (Projects » Billing » Print Billings), you can print a worksheet that details how the retroactive bill was computed. Print retroactive bills from the Print Standard Bills screen (Projects » Billing » Print Billings) and post them using the regular Post Standard Bills screen (Projects » Billing » Post Billings).
For cost-reimbursable projects, select the Indirect Costs option in the Calculate Retroactive Billings screen (Projects » Billing » Calculate Billings). Also, enter the period that will be referenced in the Pool Rates subtask of the Cost Pools screen (Projects » Cost and Revenue Processing » Cost Pool Setup) to obtain the provisional indirect rates that should be used. The starting and ending subperiods that are to be calculated for the retroactive bill are not applicable if you select the Indirect Costs option (unless Apply Burdening Based on is Current Period Rates in the Corporate Settings subtask of the Project Settings screen (Projects » Project Setup » Controls)). The entire fiscal year is subject to the retroactive calculation for the cost pools that have changed. If the retroactive billing period involves an earlier fiscal year, that year must be calculated separately. Costpoint multiplies the posted cost or hours (for hours-based pools) transactions from the Maintain Closed Billing Detail screen (BILLING_DETL_HIST) by the new provisional rates to arrive at new burden transactions. It then subtracts burden transactions from BILLING_DETL_HIST from the new burden transactions to arrive at the retroactive amounts. The Maintain Billing History screen (Projects » Billing » Billing History) (BILLING_SUM) is referenced to provide the new cumulative amounts. Note that all calculations for fees, retainages, and ceilings are completed for retroactive billings.
For loaded labor rate changes, you must select the Loaded Labor Rates option in the Calculate Retroactive Billings screen (Projects » Billing » Calculate Billings). With this option, you can designate the starting and ending subperiods that you want calculated. The selected subperiod range refers to the subperiod in which the labor hours were originally posted. With loaded labor rate projects, you can span more than one fiscal year in the retroactive calculation. For the subperiods subject to the retroactive billing, you must execute the Load Labor Rates screen (Projects » Cost and Revenue Processing » Revenue Processing or Projects » Billing » Prepare Billings) for each subperiod, one period at a time. This process updates the Labor History table (LAB_HS) with the revised billing rates for the periods that require retroactive billing. As does the Indirect Costs option, retroactive Loaded Labor Rate bills use the Maintain Closed Billing Detail screen (Projects » Billing » Billing History) (BILLING_DETL_HIST) to obtain the posted labor transactions. The labor history table is used to obtain the new loaded labor rate; BILLING_SUM (the Maintain Billing History screen (Projects » Billing » Billing History)) is used to calculate the cumulative amounts. Note that all calculations for fees, retainages, and ceilings are completed for this type of retroactive billing, as well. If a loaded labor rate project includes indirect costs applied to non-labor amounts, you should use the Indirect Costs calculation method. The system calculates this portion of the retroactive bill using the same method described in the cost-reimbursable section in the previous paragraph.
The system generates retroactive bills using transactions from the history tables (BILLING_DETL_HIST) only. The retroactive billing calculations do not reference the Maintain Open Billing Detail screen (Projects » Billing » Prepare Billings) (OPEN_BILLING_DETL). Therefore, retroactive bills contain only transactions that have been billed and posted to history. They do not contain current transactions that have not been previously billed. You can bill current transactions in a separate calculation after posting the retroactive bill. For loaded labor rate projects, the result is an invoice with no hours and only the dollar differential on the bill. For cost-reimbursable projects, the difference appears in the indirect cost billing lines. Any affect on the fees, retainages, and over-ceiling lines displays on the applicable lines.
Retroactive bill calculations generate a regular bill that you can edit or delete in the Edit Standard Bills screen (Projects » Billing » Edit Billings). To review the retroactive bills, you can use the Print Retroactive Billing Worksheets screen (Projects » Billing » Print Billings) to print a worksheet. You can print a loaded labor rates worksheet or an indirect costs worksheet. For loaded labor rate projects, you can also sort the billing lines by PLC or employee.
Each time you execute the Calculate Retroactive Billings screen (Projects » Billing » Calculate Billings), the system first purges the table storing the retroactive bill worksheets of any existing rows. After calculating your retroactive bills, you must print the worksheets that you have calculated before you execute the Calculate Retroactive Billings process again. You should do this even if you are calculating a retroactive bill for a project that is different from an existing worksheet.
Note that only one bill type (for example, retroactive or regular) can reside in the Edit Standard Bills screen (BILL_EDIT_DETL and BILL_EDIT_INVC_HDR) at any one time for the same project. Therefore, you must post retroactive bills before calculating regular bills, and vice-versa. Print retroactive billings from the same screen that you print regular bills: Print Standard Bills screen (Projects » Billing » Print Billings).
Before posting, you must change retroactive bills to a SELECTED, or accepted, status. You can designate this status for an individual project in the Edit Standard Bills screen or for a range of projects in the Select Bills for Posting screen (Projects » Billing » Edit Billings). Post the bills in the regular Post Standard Bills screen (Projects » Billing » Post Billings).