Firmwide Overhead Allocation

If you are not using the Organization Reporting application, Vision automatically allocates overhead on a firmwide basis. Likewise, if you are using the Organization Reporting application, you have the option of allocating overhead on a firmwide basis, essentially treating the entire firm as one organization.

To set up firmwide overhead allocation, you choose assignment or proration as the allocation method, you choose labor or revenue as the allocation base, and you set up an Overhead Variance project number (if using the Assignment method) to store any difference between actual and applied overhead. You enter this information in Configuration > Accounting > Overhead Allocation.

When you use the assignment method, you define the firmwide overhead rate.

When you use the proration method, Vision calculates the firmwide overhead rate based on actual activity:

Firmwide Overhead Rate (Proration Method) = Year-to-date Indirect Expenses / Year-to-Date Direct Labor or Revenue

Actual Overhead

When Vision calculates actual overhead it uses one of the following formulas:

Overhead by Project	Firmwide Overhead Rate * Year-to-Date Base by Project = Overhead Allocated to Project
Overhead from Non-operating Organizations	Firmwide Overhead Rate * Year-to-Date Base for Organization = Overhead for Organization