Deltek GCS Premier

1. Deltek GCS Premier Contracts & Billing Overview

2. Setting up Contracts • Contracts • Contract Master File • Contract Labor Categories • T&M Billing Rates • Contract Work Force • Budgeting • Non-Labor Budgets – Summary Budgets * Ceilings • Billing • Billing Master File

3. Contract Setup • Questions to ask before you start setting up • What is the contract type? • Cost Plus – how is fee % computed • Fixed Price – billed monthly, milestones or as incurred • T&M – billing rates by category, when do rates change • How is the contract billed? • By Line items, Labor Categories? • How is the Contract Value assigned? • Each line item has an assigned contract value • Contract value is for the total contract but tasks are used for internal tracking

4. Contract Master File • Main Job number usually a Contract • Assign Contract Number • Main number is 4 characters, alphanumeric • Task • Second is a 3 character Task • Can set up a range of tasks • Type in the description • Choose Division • Type in Project Manager Name • Be consistent with spelling • Choose Type • C for Contract, P for Bid & Proposal, R for Internal Research & Development, W for Work in Process

5. Contract Master File • Type in a Client Name • Be consistent with spelling • At right, settings for Task Revenue and Task Accts Receivable • Usually Check both Task Revenue and Task A/R if: • The contract value is a the Task Level • You bill by Task • Customer pays each task individually • Usually do not check Task Revenue and Task A/R if: • The contract value is covers the entire contract • Task tracking is mainly internal • Active Flag • Prevents charging except for recording Revenue and Billing • If you don’t want employees to see charge in Time & Expense, mark it inactive

6. Contract Master File (CMF) • Contract Numbering • If using Tasks, start with 001 or higher instead of using 000, in case you get more tasks • If not using Tasks, set up 000 since all the summary information must go to the 000 task • Can use Alphanumeric • Plan ahead for future numbering • Special Topics to review • Work Breakdown Structures • Task Revenue vs Contract Revenue • Revenue Recognition • Troubleshooting Revenue

7. CMF: Settings for All Contract Types Tab • Complete the Prime Contract Number • Complete the Other contract number for subcontractor • Database fields • Box for commercial used for Incurred Cost Report • Priority Rating used for printing on Purchase Orders • Consultants – just to mark if allowed – will not prevent charging • Check Contract Work Force Required • Means that Employees are authorized to work on this charge number • Also used to create Charge Tree in Time & Expense

8. CMF: Settings for All Contract Types Tab • Billing Address • This will print out on the Billing • Put your Client Name as the first line • If you need more lines, put an “*” in the first position under correspondence address to use the rest of the lines • If you leave this blank, top of your billing will be blank

9. CMF: the MONEY Page • The MONEY PAGE • Will be able to select which page based on the Contract Type (Cost Plus, Fixed Price or T&M) • Contract Value • Start and End Dates • Revenue calculation fields • Revenue method

10. CMF: Money Page • Contract Value • Must complete this for Job reports and billing to calculate correctly • If Cost Plus, put a separate amount for fee pool • If T&M or Fixed Price, skip the fee field • Enter the Funded amount as the same as Value unless you are partially funded • Separate Modification screen to enter Mods as needed • Most companies use the “authorized” contract value and not the contract ceiling • Job Reports – will not compute Revenue above the contract value on T&M or Fixed Price unless other settings create override; Cost Plus will still compute Revenue unless Maximum Revenue or Ceiling on Fee set

11. CMF: Money Page • Contract Value • If you set up several tasks at once or “clone” tasks, you’ll need to edit the contract value and settings for specific tasks • The system automatically sets up the “ALL” task • ALL task can be used to make changes that affect all the tasks, by using Pass Changes to All tasks.

12. CMF: Money Page • Period of Performance Dates • Put the start and end dates • System provides warning messages if transactions are after the end date, but does not prevent charging • In Time & Expense, can set the period of performance to prevent charging

13. CMF: Money Page • Revenue Calculation Settings • Boxes displayed are different based on contract type of Fixed Price, T&M and Cost Plus • When printing Job Reports, if the revenue is not computing correctly, it will be because of the settings on this page • Usually check “auto-compute revenue” • Usually check Normal Method • If you use Equal to Billings, you will not show revenue until you’ve posted billings.

14. CMF: Money Page • Cost Plus Revenue Calculation Settings • Enter Fee % usually computed as fee pool divided by contract cost • Determine if some costs do not earn fee – will need to put Fee Ceilings under Summary Budgets * Ceilings • Some contracts are Level of Effort and will have a fee pool based on hours, so use fee per hour

15. CMF: Money Page • Fixed Price Revenue Calculation Settings • Can be set up to compute same way as Cost Plus • Can use % completion but would have to update that each month to recognize more revenue • If billing is Fixed monthly amount, may want to use Revenue equal to Billing • To track revenue based on hours expended, set up as a T&M – total labor value divided by hours bid, or use fully burdened labor • At end of contract, can use revenue adjustment to pick up remaining revenue or change Backlog amount to zero.

16. CMF: Money Page • T&M Revenue Calculation Settings • Will use hours incurred in current month for each labor category times billing rate for that category on T&M Billing Rates file • Settings for “include ODC in revenue” means that you will bill for travel, materials, etc. so revenue should include the travel, material costs. • Settings for “include burden on ODC in revenue” means that you bill for G&A on travel, materials, etc. so revenue should include the burden • Can use equal to billings • Profitability analysis – look at billing rate divided by pay rate for each employee

17. What is Revenue? • Revenue is the measure of what you’ve earned on the contract • Revenue Recognition is the method you choose to determine what you’ve earned • Simplest method is Revenue equals Billing • When Billing doesn’t match the way the work is being performed, may have to use more advanced revenue recognition for reporting and profit – follows matching principle

18. Revenue Recognition Methods • Controlled by “Money Page” of Contract Master file and by Summary Budgets * Ceilings • Methods • Equal to Billings • Normal Method • Delivery (rarely used) • Equal to GL (rarely used) • Factors • Contract Value Ceilings • Fee % • Apply Burdens • Ceilings or Maximum Revenue • Special Controls • Budget Ceilings on direct costs • Indirect Rate ceilings

19. Revenue Analysis • Contract Types • T&M • Labor category hours times T&M Billing Rate • Current Period Only • Remove Revenue Adjustments after closing period • Cost Plus • Direct Costs plus Applied Indirects • Target Rates or Actual Rates • Fee % in Contract Master File • Always Year-to-Date • Do not remove Revenue Adjustments after closing period • Fixed Price • Similar to Cost Plus but other options apply

20. CMF: Revenue Adjustments on the Money Page • Revenue Adjustments • Revenue adjustment is a way to force revenue either up or down • Don’t think in terms of debit or credit • If revenue shown is too low, add a positive revenue adjustment • If revenue is overstated, add a negative revenue adjustment. • Recompute revenue and review. • If it’s not making sense, remove the revenue adjustment and recompute. Also look at ceilings

21. Running Contract Reports • Contract Revenue & Reporting • Compute Revenue • Job Status Reports • Job Summary Report • Labor Hours by Employee with Bill Rates • ODC Detail Report • T&M Sales Worksheet • Cost and Revenue Reports • Contract Revenue Summary • Contract Cost Summary • Revenue Analysis • Post Revenue Journal

22. Revenue Processing • Contracts: Revenue and Reporting • Compute Revenue • Contract information from the Contract Master File • Latest information posted in General Ledger • Labor hours in Labor Summary File from posted timesheets and consultant hours • Actual and Target indirect rates from the Indirect Pool File • Ceilings on direct cost and pool rates from Summary Budgets * Ceilings

23. Compute Revenue • Sequence • Post Labor Distribution • Post Voucher Distribution • Record any other changes that affect direct costs • Post billings if you are using “Revenue Equals Billings” • Run Compute Revenue • Typically use Target Rates to track Contract Status • Run as many times as needed

24. Job Status Reports • Job Status Reports • Job Summary Report – Sequence #1 • Costs on job plus indirect rates at Target • Revenue • Cost plus is total cost plus fee% from Contract Master File • T&M is Labor Category Hours times Billing Rate • Boxes to Check • 2nd & 3rd – include fee & Revenue, show indirect rates • all tasks included • Labor Detail by Employee – Sequence #2 • Year-to-Date ODC Detail – Sequence#3

25. Troubleshooting Revenue • If setting Revenue = Billings: • Have you posted the Billing Journal? • Check Contract Master file settings • Cost Plus • Look at Contract Value, Maximum Revenue, Ceiling on Fee, Fee %, and Revenue Adjustment • Fixed Price • Look at Contract Value, Fee %, Revenue Adjustment • T&M • Look at settings to “include ODC in Revenue” or “include burden on ODC in Revenue” • If the Revenue is wrong – the Billing will be wrong

26. Post the Revenue Journal • Print/Post Revenue/WIP Journals: • Credits Revenue, Suffix 30 • Debits Unbilled, Suffix 12 • If you haven’t posted Revenue, your Income Statement won’t show Current Period Revenue

27. Billing Process • Billing Master File • Add Billing Tasks • Box at bottom – Suppress None • Billing Information page – check box to include Cumulative • Contract Billings • Compute Contract Billings • Billing Edit File – view, check box to Select, put dates • Print form 1035 Billings • Post Billing Journal • Debits Accts Receivable, Suffix 11 • Debits Unbilled, Suffix 12

28. Review Unbilled Accounts Receivable Report • Be sure Revenue Journal and Billing Journal have been posted • Print Unbilled AR report • Select Sales at Target • Uncheck Include Future Period Costs • Uncheck Suppress Per GL Column • Review amounts in the Per G/L Column • Analyze and explain unbilled amounts • To review, print GL Detail report for account range from suffix 11 to suffix 30

29. Contracts and Billing Summary • Job Reporting and Billing Controlled by Contract Master File, Billing Master File & Summary Budgets * Ceilings • Processing Steps • Post all Direct Costs • Compute Revenue • Print and Review Job Status Reports • Post Revenue Journal • Compute Billings, Select, Print • Post Billing Journal • Review Unbilled A/R report to explain any differences