Adjust Salaried Job Cost

Use the Adjust Salaried Job Cost feature to create an adjusted hourly job cost rate for each salaried employee, based on the employee's salaried pay rate and the actual hours that the employee works each pay period.

When an employee charges time to a project, Vantagepoint calculates labor costs using the job cost rate defined for the employee in the Employees hub. If the employee is paid hourly, the labor cost reflects the actual cost of the hours worked. If the employee is salaried, the employee may charge time for which they are not paid. In this case, the labor charged to the project exceeds the amount actually paid to the employee.

The adjusted rate reflects the actual cost of the employee's labor and provides more accurate payroll costing for salaried employees.

This feature is typically used by enterprises who perform government work, because the government requires that projects be costed at actual rates rather than at standard rates.

Timing

You should run the Adjust Salaried Job Cost process in synchronization with your payroll periods. If this is not possible, then you should run the Adjust Salaried Job Cost process more frequently than your payroll periods.

Benefits

The Adjust Salaried Job Cost feature:

• Minimizes the amount in the Job Cost Variance account. If salaried job cost rates are equal to pay rates each pay period, there is no variance in this account.
• Requires employees to enter all hours worked on a project.
• Provides more accurate payroll costing.
• Allows all hours to be costed, even if overtime hours are entered with a zero cost rate.

Considerations in Using Adjust Salaried Job Costing

The Adjust Salaried Job Cost feature:

• Causes job cost rates to fluctuate from period to period.
• Makes project budgeting more difficult.
• May lead to inaccurate reporting data.
• Results in revised timesheet posting logs and adjusted general ledger balances.