Project Accounting—Key Exercises

IMPORTANT
It is extremely important that you set up and work within your own company to maintain your data integrity. If you work within any other company, your exercises will not function as intended and the data of other students might be affected. Predictable exercise results require that your data be isolated in your own company.

Basic Data Setup

Purpose: The purpose of this exercise is to show you how to set up the basic data required for running this functionality. Before starting to use project accounting, some preparations must be performed in IFS Accounting Rules. For example, the code part function for using project accounting must be defined. Also, the code part demands for the accounts that are used for projects are checked or modified in IFS/Accounting Rules. Posting controls required for creating capitalization postings must also be defined.

Windows:
Define Code String
Account

Code Part Function

  1. Open the Define Code String window.
  2. In the Internal Name field, enter Project. 
  3. Verify that the value in the Code Used field is Yes for the code part.
  4. In the Code Part Function list for one code part, click Project Accounting.

Code Part Demands

  1. Open the Account window.
  2. Verify that all the code part demands for each of the accounts used for project accounting, i.e., cost and revenue accounts, are either Can or Mandatory.

Main Exercises

Capitalize Revenues/Expenses Projects

Purpose: Capitalize Revenues/Expenses projects can be used for your company's own production of for example fixed assets or for projects for customers. Such projects do not affect the revenue and cost accounts during the lifetime of the project. The update routine automatically creates reverse entries for all postings to the project's cost and revenue accounts. This is done according to the posting control.

When the project is specified as completed, a voucher is created including postings for capitalized revenues back to the original accounts or to the code string specified as the project's reposting rule. Capitalized costs are also posted back to their original accounts or to the code strings defined for the project. 

Windows:
Posting Control
Project Groups
Project
Voucher Entry
Update GL Vouchers
GL Update History
Authority Combinations
Projects Analysis
Project Analysis
GL Balance Analysis
GL Vouchers Analysis
Project Balance Report
Archived Reports

Note: In the online help files (press F1 in e.g. Project and follow the links) there is more information on Capitalize Revenues/Expenses projects.

Posting Control

  1. Open the Posting Control window.
  2. Check the accounts that are specified for Posting Types GP 3, Capitalized Project Cost, and GP 4, Capitalized Project Revenue. These accounts must have the Can or Mandatory code part demand for the code part used for projects.

Enter Project Group

  1. Open the Project Groups window.
  2. Create new record and enter Project Group and Description.
  3. Set Capitalization Posting Method to Transaction.
  4. Save your changes.
  5. In the All Ledgers tab, create new record on the Project Information sub tab.
  6. Select project type Capitalize Rev/Exp from the list.
  7. Save your changes.
  8. Activate the project group by right-clicking in the header and selecting Activate.

Enter Project

  1. Open the Project window.
  2. Create new record and enter Project ID and Description and Project Group.
  3. Make sure your Capitalization Posting Method is set to Transaction.
  4. Save your changes.
  5. In the All Ledgers tab, select the Project Information sub tab.
  6. Verify information for the new project. Make sure Project Type is set to Capitalize Rev/Exp.
  7. Save your changes.

Enter Voucherss

  1. Open the Voucher Entry window.
  2. Enter vouchers for the project.

Update Vouchers

  1. Open the Update GL Vouchers window, and check the default values.
  2. Click OK to begin the updating routine.
  3. Open the GL Update History window. Verify that all vouchers have passed the check in the updating routine.

Authority

  1. Open the Authority Combinations window.
  2. Check to see what authority your authority class has.

Queries

  1. Open the Projects Analysis window. This window displays summarized information about one or more selected projects. Find the revenues and costs for the project.
  2. Open the Project Analysis window. This window displays information about only one project at a time. You can use Project list to view other selected projects. Find the revenues and costs for the project.
  3. Open the GL Balance Analysis window. Verify that the sum of the costs and revenues is zero.

Reposting Rule

  1. Open the Project window, and find information about the project.
  2. Click the Reposting Rule tab. Create a reposting rule by entering the appropriate information.

Project Completion

  1. Open the Project  window, and find information about the project.
  2. Right-click and then click Project Completion.
  3. Specify a date in the Completion Date field. A voucher of Voucher Type P is created and transferred to the hold table. On the voucher, the revenues and costs are reposted on the original accounts or other accounts, if a reposting rule is specified.

Update Vouchers

  1. Open the Update GL Vouchers window, and check the default values.
  2. Click OK to begin the updating routine.
  3. Open the GL Update History window. Check to see whether any vouchers have not passed the check.

Queries

  1. Open the GL Vouchers Analysis window. Check the voucher information (Voucher Type P).
  2. Open the Project Analysis window. Find information about the project.

 Project Balance Report

  1. Open the Project Balance Report window.
  2. Preview and/or print the report.

Report Archive in Info Service

  1. Open the Archived Reports window.
  2. Find the report that you ordered, and preview it.

Capitalize Expenses Projects

Purpose: Capitalize Expenses projects can be used for long-term projects that are partially invoiced on a continuous basis. Only cost transactions are capitalized. The real costs of the project do not affect the result accounts during the lifetime of the project. The update routine automatically creates reverse entries for cost postings for the project in the same way as for capitalization projects.

When you post revenue for the project, a preliminary cost is estimated based on the contribution margin ratio specified for the project.

When the project is specified as completed, a voucher is created in which the preliminary costs are reversed to the capitalized cost.

Windows:
Posting Control
Project Groups
Project
Voucher Entry
Update GL Vouchers
GL Update History
Authority Combinations
Projects Analysis
Project Analysis
GL Balance Analysis
GL Vouchers Analysis
Project Balance Report
Archived Reports

Note: In the online help files (press F1 in e.g. Project and follow the links) there is more information on Capitalize Expenses projects.

Posting Control

  1. Open the Posting Control window.
  2. Check the accounts that are specified for Posting Types GP 3, Capitalized Project Cost, and GP 5, Calculated Project Cost. The accounts must have the Mandatory code part demand for the code part that is used for projects.

Enter Project Group

  1. Open the Project Groups window.
  2. Create new record and enter Project Group and Description
  3. Set Capitalization Posting Method to Transaction.
  4. Save your changes.
  5. In the All Ledgers tab, create new record on the Project Information sub tab.
  6. Select project type Capitalize Expenses from the list.
  7. Save your changes.
  8. Activate the project group by right-clicking in the header and selecting Activate.

 

Enter Project

  1. Open Project window.
  2. Create new record and enter Project ID and Description and Project Group
  3. Make sure your Capitalization Posting Method is set to Transaction.
  4. Save your changes.
  5. In the All Ledgers tab, select the Project Information sub tab.
  6. Verify the information for the new project. Make sure Project Type is set to Capitalize Expenses.
  7. Enter a contribution margin as a percentage.
  8. Save your changes.

Enter Vouchers

  1. Open the Voucher Entry window.
  2. Enter vouchers for the project.

Update Vouchers

  1. Open the Update GL Vouchers window, and check the default values. Click OK to begin the updating routine.
  2. Open the GL Update History window. Verify that all vouchers have passed the checks in the updating routine.

Authority

  1. Open the Authority Combinations window.
  2. Check to see what authority your authority class has.

Queries

  1. Open the Projects Analysis window. This window displays summarized information about one or more selected projects. Find the revenues and costs for the project.
  2. Open the Project Analysis window. This window displays information about only one project at a time. You can use Project list to view other selected projects. Find the revenues and costs for the project.
  3. Open the GL Balance Analysis window. Find information about the project, and compare it with the amounts displayed in the query windows that you viewed previously.

Reposting Rule

  1. Open the Project window, and find information about the project.
  2. Enter information for a reposting rule.

Project Completion

  1. Open the Project  window, and find information about the project.
  2. Right-click and then click Project Completion. Specify a date in the Completion Date field. A voucher of Voucher Type P is created and transferred to the hold table.

Update Vouchers

  1. Open the Update GL Vouchers window, and check the default values. Click OK to begin the updating routine.
  2. Open the GL Update History window. Verify that all vouchers have passed the checks in the updating routine.

Queries

  1. Open the GL Vouchers Analysis window. Check the voucher (Voucher Type P).
  2. Open the Project Analysis window. Find information about the project.

 Project Balance Report

  1. Open the Project Balance Report window.
  2. Preview and/or print the report.

Report Archive in Info Service

  1. Open the Archived Reports window.
  2. Find the report that you ordered, and preview it.

Capitalize Revenue Projects

Purpose: This project type can be used for projects where revenue is not incurred at regular intervals compared to cost. Only the revenue transactions are capitalized to show in the balance sheet. In order to recognize the revenue when calculating profit and loss, revenue recognition process should be executed. Capitalize revenue type projects recognize cost based on actual cost.

 

Windows:
Posting Control
Project Groups
Project
Voucher Entry
Update GL Vouchers
GL Update History
Authority Combinations
Projects Analysis
Project Analysis
GL Balance Analysis
GL Vouchers Analysis
Project Balance Report
Archived Reports

Posting Control

  1. Open the Posting Control window.
  2. Verify the accounts specified for Post Type GP4, Capitalized Project Revenue. These accounts must have the Can or Mandatory code part demand for the code part used for projects.

Enter Project Group

  1. Open the Project Groups window.
  2. Create a new record and enter Project Group and Description.
  3. Set Capitalization Posting Method to Transaction.
  4. Save your changes.
  5. In the All Ledgers tab, create a new record in the Project Information sub tab.
  6. Select project type Capitalize Revenue from the list.
  7. Save your changes.
  8. Activate the project group by right-clicking in the header and selecting Activate.

Enter Project

  1. Open the Project window.
  2. Create a new record and enter Project ID and Description and Project Group.
  3. Make sure your Capitalization Posting Method is set to Transaction.
  4. Save your changes.
  5. In the All Ledgers tab, select the Project Information sub tab.
  6. Verify the information for the new project. Make sure Project Type is set to Capitalize Revenue.
  7. Save your changes.

Enter Vouchers

  1. Open the Voucher Entry window.
  2. Enter vouchers for the project.

Update Vouchers

  1. Open the Update GL Vouchers window, and check the default values.
  2.  Click OK to begin the updating routine.
  3. Open the GL Update History window. Verify that all vouchers have passed the check in the updating routine.

Authority

  1. Open the Authority Combinations window.
  2. Check to see what authority your authority class has.

Queries

  1. Open the Projects Analysis window. This window displays summarized information about one or more selected projects. Find the revenues and costs for the project.
  2. Open the Project Analysis window. This window displays information about only one project at a time. You can use Project list to view other selected projects. Find the revenues and costs for the project.
  3. Open the GL Balance Analysis window. Find information about the project, and compare it with the amounts displayed in the analysis windows that you viewed previously.

Project Completion

  1. Open the Project  window, and find information about the project.
  2. Right-click and then click Project Completion.
  3. Specify a date in the Completion Date field. A voucher of Voucher Type P is created and transferred to the hold table.

Update Vouchers

  1. Open the Update GL Vouchers window, and check the default values.
  2. Click OK to begin the updating routine.
  3. Open the GL Update History window. Verify to see whether any vouchers has not passed the check.

Queries

  1. Open the GL Vouchers Analysis window. Check the voucher information (Voucher Type P).
  2. Open the Project Analysis window. Find information about the project.

 Project Balance Report

  1. Open the Project Balance Report window.
  2. Preview and/or print the report.

Report Archive in Info Service

  1. Open the Archived Reports window.
  2. Find the report that you ordered, and preview it.

No Capitalization Projects

Purpose: No-capitalization projects are the simplest form of project accounting. Costs and revenues for this type of project are not capitalized. However, project accounting is updated, meaning that you can use the queries and reports for project accounting. Costs and revenues directly influence the company's results. 

Windows:
Project Groups
Projects
Projects Analysis
Voucher Entry
Update GL Vouchers
GL Update History
Authority Combinations
Projects Analysis
Project Balance Report

Note: The online help files (particularly the help file for the Project window) contain further information on no capitalization projects. To view the help file for a particular window, open the window, and press F1.

Enter Project Groups

  1. Open the Project Groups window.
  2. Create new record and enter Project Group and Description.
  3. Set Capitalization Posting Method to Transaction.
  4. Save your changes.
  5. In the All Ledgers tab, create a new record on the Project Information sub tab.
  6. Select project type No Capitalization from the list.
  7. Save your changes.
  8. Activate project group by right-clicking in the header and selecting Activate.

Specify Project

  1. Open the Project window.
  2. Create new record and enter Project ID and Description and Project Group.
  3. Make sure your Capitalization Posting Method is set to Transaction.
  4. Save your changes.
  5. In the All Ledgers tab, select the Project Information sub tab.
  6. Verify the information for the new project. Make sure Project Type is set to No Capitalization.
  7. Save your changes.

Enter Vouchers

  1. Open the Voucher Entry window.
  2. Enter vouchers for the project.

Update Vouchers

  1. Open the Update GL Vouchers window, and check the default values.
  2. Click OK to start the updating routine.
  3. Open the GL Update History window. Make sure that all vouchers have passed the controls in the updating routine.

Authority

  1. Open the Authority Combinations window.
  2. Verify the authority of your authority class.

Queries

  1. Open the Projects Analysis window. You can use this window to see a summary of multiple projects that you have selected. Find the revenues and costs for the project.
  2. Open the Project Analysis window. This window shows information for one project at a time. You can select other projects from the Project list. Find revenues and costs for the project that you set up for this exercise.

Project Completion

  1. Open the Project window, right-click and then click Project Completion.
  2. The status of the project changes to Completed, and a completion date is set for the project. No voucher is created.

 Project Balance Report

  1. Open the Project Balance Report window.
  2. Preview and/or print the report.