Cost Allocation and Settlement

Solution overview

Allocating and settling indirect costs is a time-consuming and labour-intensive task. The ANEGIS Cost Allocation and Settlement module allows you to automate the process and let Dynamics 365 do the heavy lifting for you. Using lagging financial data leads to unreliable costs analysis. The module enables settlement with real-time data, allowing in-depth and accurate financial analysis.

Cost Allocation and Settlement module overview

The result of the cost accounting mechanism is a financial spreadsheet with transfers to financial accounts and/or projects.

The Cost Allocation and Settlement module provides the operational visibility necessary to make reliable analysis and informed decisions.

Cost Allocation and Settlement features

  • define any number of algorithms/keys for cost settlement
  • define deviation indicators
  • generate costs allocation/accounting allocation; post both to the general ledger as well as project transactions
  • perform settlement by source of main account and financial dimensions, into other financial dimensions
  • define the scope of accounts included in the specific definition of cost settlement
  • define the scope within the financial dimension
  • define non-financial keys (kilometre, hour, metre, etc.)
  • define formulas with which to perform cost settlement
  • distribute account balances (e.g. purchase costs, deviations) according to the proportion of materials used
  • generate in the general ledger an unrecorded financial spreadsheet with an appropriate allocation of costs in account records/projects
  • define the order of calculations according to definition (stage queue) – building sets containing several calculations arranged by the specific conversion logic
  • generate calculation results to a selected table, e.g. valuation sheet, rate table
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Challenges

Accuracy and transparency of billing
Challenge:

Complex cost structures and diverse funding sources can lead to errors in billing.

Solution:

Implementing a system for automatic cost tracking that allows precise allocation of expenses to the appropriate units or projects.

Managing multiple funding sources
Challenge:

Companies often use various funding sources (e.g., budgets, grants, funds). It is necessary to track which costs can be allocated to each source.

Solution:

A cost management system should enable flexible allocation of costs to different funding sources and generate reports for each source.

Complex organizational structures
Challenge:

In large companies or corporations, there are many units, departments, or projects. Costs must be allocated among them.

Solution:

In large companies or corporations, there are many units, departments, or projects. Costs must be allocated among them.

Flexibility in cost allocation
Challenge:

Costs can have various categories (e.g., salaries, materials, external services). It is necessary to enable flexible allocation to appropriate accounts.

Solution:

A cost management system should allow for the definition of custom cost categories and their adjustment to the company's specifics.

Managing changes and updates
Challenge:

Cost structures and funding sources can change over time. It is necessary to track these changes and update the system.

Solution:

Regular reviews and updates of the system, as well as educating employees on the correct allocation of costs.

Advantages

Precise cost allocation

The IT Cost Allocation and Settlement solution enables precise allocation of costs to the appropriate departments, projects, or products, leading to better cost understanding and increased financial transparency.

Improvement in decision-making processes

Accurate cost information can assist in making better strategic and operational decisions.

Increased profitability

By better managing costs and optimizing expenses, companies can increase their profitability.

Expense optimization

With accurate cost allocation, companies can better understand where money is being spent, allowing them to identify areas for optimization and potential savings.

Regulatory compliance

Many industries have specific requirements for cost allocation. The IT Cost Allocation and Settlement solution can help meet these requirements and ensure compliance.

Improvement in Financial Reporting

Accurate and detailed cost information can improve the quality of financial reporting and provide a better understanding of the company’s financial performance.

"Based on our cooperation, we confirm the experience, professionalism and realibility of ANEGIS employees. We recommend this vendor as a reliable business partner."
Ewa Franczak
Group Information Systems Manager, Nicols
"ANEGIS provided excellent support for our Dynamics AX Parent Company finance installation. Their consultants are top quality, highly effective professionals."
Marie Capes
Director of Finance and Administration, WPP London
"ANEGIS’ commitment and reliable approach were a key factor in our decision to work with them, and they continue to deliver in an effective and timely mannner."
Neil Hammond
IT Director, BUUK Infrastructure
"Our go-live was successful! Thank you to all of you. Let me repeat that I am really thankful!"
Dr. Rick Dannert
Project Manager, New Yorker
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