Managing allocation rules

Organizations use allocations to share expenses across departments or other groupings. For example, you can allocate salaries of C-level executives to other departments or branches based on the time spent in support of those groups. You can also allocate their salaries based on their impact on profits. Regardless of how you construct an allocation, each allocation is defined by the following:

• Rules that identify the costs to be allocated (cost pool)

• The departments to receive allocated costs

• The percentage to be allocated to each department

• The order in which those costs are allocated

• Target and offset allocation GL account

NOTE: Typically, expenses are allocated; however, you can also use the Cost Allocation Engine to allocate income balances.

Use Organizational Profitability page to add, edit, and copy cost allocation rules, as well as process allocations and review the allocation calculations. Allocation rules are processed by the Cost Allocation Engine.

TIP: To review examples that demonstrate the configuration of different type of allocation rules, see Allocation rule examples.

Manage and Process Data tab

To open the Manage and Process Data tab:

1. From the Command Center, click Organizational Profitability.

2. Click the Manage and Process Data tab. This page has the following sub-tabs:

   • Add or edit allocations

   • Add or edit unit rates

   • Process allocations

   • Review allocations

Add or Edit Allocations

Use the Add or Edit Allocations sub-tab to add, edit, and copy allocation rules. The sub-tab also features bulk editing and group management functionality and easy reordering of allocation rules.

For details, see Adding allocations, Editing allocations, and Using allocation groupsUsing allocation groups.

Add or Edit Unit Rates

Use the Add or Edit Unit Rates sub-tab to manage allocation unit rates for a budget. You can allocate expenses from department(s) to department(s), in addition to the existing method of use a percentage. Unit rates can be used with actual expenses, budgets, and forecasts.

For details, see Working with unit rate allocations.

Process Allocations

Use Process Allocations sub-tab to run allocation rules for a specific time period.

For more information, see Processing allocations.

Review Allocations

The Review Allocations sub-tab provides access to the Cost Allocation Engine utility, from which you can review the changes made as a result of processing allocations.

For additional information, see Reviewing allocation calculations .