Absent Member.. JavierT Absent Member..
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Could actual labor costs be considered as capitalized costs in a financial summary (asset)?

Hi!
 
I have a financial summary in an asset request type (request with a "PFM Asset" field group), linked to a specific staffing profile.
To enable tracking of capitalized costs for this asset I set to true the COST_CAPITALIZATION_ENABLED parameter in the server.conf configuration file.
For every position into the staffing profile I set the expense type field to categorize capital expenses. That means in the "forecast and actuals details" section of the financial summary I have a table named "Capital" with as many lines as different positions there are in the staffing profile (for each period it shows the planned costs according to time defined previously in that staffing profile).
 
Logging as one of the users assigned to a position of that staffing profile, I created a timesheet and added several hours to the asset (I configured previously the resource tracking section in the asset request type so all resources allocated in the staffing profile may use time management to track actuals).
I configured the financial summary so it calculates the actual labor costs from time logged against the asset. However, despite all profiles in the staffing profile (labor costs) are set as capital expenses (no operating expenses), the "forecast and actuals details" section of the financial summary shows a new table named "Operating" and it includes all actuals added into the timesheet. That means the financial summary is considering all labor costs as operating, no matter the expense type you set previously for every profile into the staffing profile. Is there any way of changing this so actual labor costs can be considered as capitalized cost in a financial summary? It seems very odd to have labor costs (for every profile) set as capital expenses and later PPM set as operating all actual costs linked to those profiles.
 
By the way, I am currently using HP PPM 9.14. Do you know if this happens as well in newer releases of PPM?
 
Thanks a lot,
Regards,
 
Javier

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CGut Absent Member.
Absent Member.

Re: Could actual labor costs be considered as capitalized costs in a financial summary (asset)?

Hi Javier and sorry for the delay,

 

Options to Display Capital or Operating Costs in Financial Summary Graph


In version 9.12, the graph in the Totals by Year section of a financial summary
now includes a new field named Show Costs, with the options All, Capital, and
Operating. The field appears only if cost capitalization is enabled both in the financial summary and by setting the
COST_CAPITALIZATION_ENABLED server.conf parameter to true.

The default option is All, which causes the graph to display the same data as in prior versions. If the user selects Capital or Operating, the graph and the Forecast Cost, Actual Cost, and Approved Budget fields below the graph display only
capital or operating costs accordingly. Forecast Benefit and Actual Benefit are not affected.

 

I am attaching here the Release notes guide for 9.14 for more information.

 

Hope it helps!
Carolina


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Absent Member.. JavierT Absent Member..
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Re: Could actual labor costs be considered as capitalized costs in a financial summary (asset)?

Hi Carolina:

 

Thank you for your reply. As you say, I am able to view capital and operating costs in the "Totals by year" section.

 

However, my problem is that the financial summary is considering all ACTUAL labor costs as operating, no matter the expense type you set previously for every profile into the staffing profile.

For example, I set the expense type for a specific profile as capital. If I create a timesheet for a user linked to that profile, and add some time to it, the financial summary automatically considers all that amount as operating costs, what I consider it is wrong!. Do you know if there is any way of changing that?

 

Thanks a lot!
Regards,

 

Javier

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CGut Absent Member.
Absent Member.

Re: Could actual labor costs be considered as capitalized costs in a financial summary (asset)?

Could you please tell me which PPM version are you using?

In 9.12 there is not possible. in 9.14 it appears if cost capitalization is enabled in the FINANCIAL SUMMARY, click Financial Summary Settings, select The Financial Summary TRACKS CAPITAL COSTS checkbox, and click Save. If this
option is not selected, an Expense Type (Operating or Capital) cannot be specified when adding a cost line to the proposal’s financial summary—all expenses are operating expenses.

Setting the COST_CAPITALIZATION_ENABLED server.conf parameter to true.

Change the project’s financial summary settings as : Allow capitalized costs on this project.

Best Regards,
Carolina.

“HP Support
If you find that this or any post resolves your issue, please be sure to mark it as an accepted solution.”
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