Pool Rates

A target rate is a budgeted rate that is developed internally by your organization.  Target rates are often used to calculate revenue.  This is done to avoid large month-to-month fluctuations in revenue due to inconsistencies in the actual rates by month.  When companies recognize revenue at target, they expect the target and actual rate variance to decrease over the fiscal year.

You can run project reports using actual or targeted rates.  You must enter the year-to-date and current period rates in this screen to run reports using targeted rates.     

A provisional rate is a billing rate that is typically issued to companies that contract with the federal government.  The provisional rates are usually approved before the beginning of the fiscal year and are issued to the company.  You can enter these rates in this subtask as soon as you receive the rates for the fiscal year.  

If rates change during the year, they can be changed starting with the period in which the new rates become effective.  However, if you are calculating your indirect rates using the year-to-date method, the billing programs will make a year-to-date adjustment for the change in rates.

These rates are used only by the billing programs.  

Cost of Money (COM) is a rate that is issued to companies that contract with the federal government.  It is a billing rate that companies are allowed to charge in addition to their provisional billing rates to cover the cost of facilities used for the project.  This rate helps to differentiate the overhead from the cost of facilities.

The Compute & Print Pools Rates screen (Projects\Process\Allocations) populates the rate fields.  The system calculates the rates according to the cost pool structure that you have established.  Both the current period and year-to-date rates are calculated and updated for each period that rates are calculated.  

You can enter actual rates for periods that were calculated before the initialization of the system.  

You can use the actual rates, target rates, and COM rates on project reports.  You will have to specify the rate type to use when you select a report for printing.  

Bills are calculated using provisional rates. The provisional rates are generally rates that have been approved by the customer.

The actual and target rates are used for the calculation of revenue on cost type contracts.  Cost type contracts are usually used by companies that contract with the federal government.  

Actual and target rates are also used to allocate indirect costs to projects and for the purpose of analyzing project profitability.

The use of current period or year-to-date rates is established in the Project Settings screen (Administration\Configure\Projects) and cannot vary by project.  It is a system-wide selection.  Some revenue formulas use the current period rates shown in this subtask even if the year-to-date selection is made; however, all other calculations are made on a year-to-date basis.

For most companies that contract with the federal government, year-to-date rates are required.

Enter, or use Lookup to select, the period for this pool rate.

Enter the actual period rate for the selected period of the fiscal year. The Compute & Print Pools Rates screen (Projects\Process\Allocations) calculates and posts this rate for the current open period. You need to enter this rate only if it was calculated before the system was initialized.

Enter the actual year-to-date rate for the selected period of the fiscal year. The Compute & Print Pools Rates screen (Projects\Process\Allocations) calculates and posts this rate for the current open period.  You need to enter this rate only if it was calculated before the system was initialized.

Enter the target period rate for the selected period for the fiscal year. These rates are user-entered and affect the posting of variances and the calculation of targeted costs for each pool.

Enter the target year-to-date rates for each period of the fiscal year. These rates are user-entered and affect the posting of variances and the calculation of targeted costs for each pool.

Enter the current period billing rates for each period of the fiscal year. These are the approved provisional rates for the pool and are always user-entered.  The Calculate Bills screen (Projects\Process\Billing) uses these rates to calculate the billable indirect costs.

Enter the year-to-date billing rates for each period of the fiscal year. These are the approved provisional rates for the pool and are always user-entered.  The Calculate Bills screen (Projects\Process\Billing) uses these rates to calculate billable indirect costs.

Enter the current period COM or cost-of-money rate for each period of the fiscal year.

These rates represent the most recent Treasury Department rates that are applied to the costs of certain projects. Their application is determined by the Apply Cost of Money Rates checkbox in the Basic Info screen in the Project User Flow (Projects\Maintain\Project). The COM rate is user-entered and affects both revenue and billing computations.

Enter the year-to-date COM or cost of money rate for each period of the fiscal year selected above.

These rates represent the most recent Treasury Department rates that will be applied to the costs of certain projects. Their application is determined by the Apply Cost of Money Rates checkbox in the Basic Info screen in the Project User Flow (Projects\Maintain\Project). The COM rate is user-entered and affects both revenue and billing computations.