Allocations and AutoAllocations

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 Objectives

After completing this lesson, you should be able to do the

following:
• Explain the terminology associated with allocations
• Define and process allocation rules
• Explain the use of AutoAllocations in Oracle Project
Costing

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 Agenda

• Allocation Rules
• Process Allocations
• AutoAllocations
• Process AutoAllocations

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 Overview of Allocations

Target
Basis Method A

Source

Target
Offset B

Allocate costs to target projects

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Allocation Terminology

Allocation Terminology
Allocation
Allocation Rule
AutoAllocation Set
Basis Method
Full Allocation
GL Allocation Batch
Incremental Allocation
Offsets
Source Pool
Target

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Difference between Allocation and Burdening

Existing
Amounts
(Source)

Allocation Targets

Raw Cost x Burden Multiplier = Burden Cost

Multiplier = a set percentage

Burden

Use allocations to distribute actual costs to projects.

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 Allocation Rules Implementation Steps

Step Required? Setup Level

Define allocation rules Yes Operating Unit
Implement client extensions for No Site
allocations

Allocation Rules Implementation Steps

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 Allocation Rules

Basis method

Allocation method

Allocation period type

Targets selection

Allocation Rule Allocation transaction

attributes

Target

Source
Components of an
allocation rule Offset

Prorate

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 Basis Method

Source
Basis Method

Targets

Select a basis method to determine how to allocate

amounts to targets.

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 Basis Method - Spread Evenly

Target Project Target Task Allocation Amount

(Total = 1,000.00)
P1 A 200.00

P1 B 200.00
P1 C 200.00
P2 Y 200.00
P2 Z 200.00

Formula for Spread Evenly:

Allocation Amount = Source Pool Amount /
Number of Tasks in All Target Projects

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Basis Method - Target Percent and Spread Evenly

Target Target Target Percent Allocation Amount

Project Task (Total = 1,000.00)

P1 A 300.00
90%
P1 B 300.00
P1 C 300.00
P2 Y 50.00
10%
P2 Z 50.00

Formula for Target Percentage and Spread Evenly:

Allocation Amount = Source Pool Amount X Target Line Percentage /
Number of Tasks in All Target Projects for the Target Line

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 Basis Method - Prorate

Target Target Labor Hours Allocation Amount

Project Task (Total = 1,000.00)
P1 A 40 100.00

P1 B 60 150.00
P1 C 200 500.00
P2 Y 80 200.00
P2 Z 20 50.00

Formula for Basis Method - Prorate:

Allocation Amount = Task Labor Hours / All Target Labor Hours

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 Basis Method - Target Percentage and Prorate

Target Target Target Labor Allocation Amount

Project Task Percent Hours (Total = 1,000.00)
P1 A 100 150.00
90%
P1 B 200 300.00
P1 C 300 450.00
P2 Y 0 0.00
10%
P2 Z 50 100.00

Formula for Basis Method - Prorate:

Allocation Amount = (Source Pool Amount X Target Line Percentage) X
(Target Task Labor hours / All Target Project Labor Hours for the Target
Line)

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 Allocation Rule Definition

Incremental Allocation Method

Creates expenditure items based on
difference between previous and current run

Run
Periods JUN JUL AUG

Select either Full or

Incremental for the Full Allocation Method
Allocation Method.
Distributes all amounts

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 Source Definition

Oracle General
Ledger

Summarized Posted GL Fixed Amount

Project Costs Balances

Potential Sources

Define the source for the costs to allocate.

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 Target Definition

Services-East projects

For example, allocate to all projects owned by

the same project owning organization.

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 Offset Definition

Offset Methods

None

Source Project and Task

Source Project and Task,

Use Client Extension

Use Client Extension for

Source Offset Project and Task
Transactions
Specific Project and Task

You can define offsets to balance the allocation transactions.

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 Prorated Basis Method Definition

Project 1
Task A = 25 Hrs
Task B = 50 Hrs

Project 2
Basis Method:
Prorate Task Y = 15 Hrs

Example: Actual Task Z = 0 Hrs

Labor Hours
Targets
Define a basis for proration-based rules.

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 Copy Allocation Rules

Copy Copy
Services-East Monthly Rent
Allocation Rule

Services-West Monthly Rent Services-North Monthly Rent

Allocation Rule Allocation Rule

Copy an allocation rule to define related rules.

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Deleting or Modifying Allocation Rules

Delete Allocation
Rule?

You cannot delete an allocation rule

with an existing run.

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 Client Extensions for Allocations

Allocation Client Extensions

Allocation Source Extension
Allocation Target Extension
Allocation Offset Tasks Extension
Allocation Offset Projects and Tasks Extension
Allocation Basis Extension
Allocation Descriptive Flexfields Extension
Allocation Dependencies Extension

Optionally, implement client extensions for allocations.

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 Agenda

• Allocation Rules
• Process Allocations
• AutoAllocations
• Process AutoAllocations

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 Allocating Costs

Define Create draft Review the draft

allocation rule allocation run allocation run

No
Modify the Delete draft Run
allocation rule allocation run OK?

Yes
Reverse the draft
Release draft
allocation run (if
allocation run
necessary)

Cost allocation flow

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 Creating Allocation Runs

Submit the program PRC: Generate Allocations Transactions

Specify Parameters:

Rule Name

Period Name

Expenditure Item Date

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 Allocation Run Statuses

Submit Allocation Run

Allocation run
status flow Status:
In Process

Status: Status:
Draft Success Draft Failure

Release Allocation Run Delete Allocation Run

Status: Status:
Release Success Release Failure

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 Deleting Allocation Runs

PRC: Delete
Allocation Runs

Review the draft If not correct, Revise the rule

allocation run. then delete the and create a new
allocation run. draft allocation.

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 Releasing Allocation Runs

PRC: Release Allocations

Transactions

Release Allocates
transactions to
targets

Release the allocation run to create transactions for the target

and offset projects.

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 Reversing Allocation Runs

Reversing
expenditure
batch
Successfully
released Reverse
allocation run
Reversing
offset batch

If necessary, you can reverse an allocation run with the status

Release Success.

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 Agenda

• Allocation Rules
• Process Allocations
• AutoAllocations
• Process AutoAllocations

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 Overview of AutoAllocations

Oracle Project Costing

Responsibility
Create AutoAllocation sets
with both project allocation
rules and GL allocation
batches

Oracle General Ledger

Responsibility
Create AutoAllocation sets
with only GL allocation
batches

Use AutoAllocations to combine processing for

project allocation rules and GL allocation batches.

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 Overview of AutoAllocations

Rule or Batch Set Type Programs Submitted

Project Allocation Step • PRC: Generate Allocations
Down Transactions
• PRC: Release Allocation
Transactions
• PRC: Distribute Miscellaneous
Costs and Usages
• PRC: Update Project Summary
Amounts

Parallel • PRC: Generate Allocations

Transactions
• PRC: Release Allocation
Transactions (with Auto Release)
Programs submitted by set type for project
allocation rules

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 Overview of AutoAllocations

Rule or Batch Set Type Programs Submitted

• Mass Allocation Step • Run MassAllocations
• Mass Budget Down • Recurring Journal Entry
• Mass • Budget Formulas
Encumbrances • Posting
• Recurring
Journal Parallel • Run MassAllocations
• Recurring Journal Entry
• Budget Formulas

Programs submitted by set type for mass

allocation, mass budget, mass encumbrances, and
recurring journal allocation batches

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 AutoAllocation Rules Implementation Steps

Step Required? Setup Level

Define AutoAllocation sets Yes Operating Unit

Implement Workflow for AutoAllocations Yes Site

Implement AutoAllocation extensions No Site

AutoAllocations Implementation Steps

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 AutoAllocation Set Definition

Specify step-down
or parallel

Define
Identify default
AutoAllocation
contact
sets

Define the
AutoAllocation
steps

Components of an AutoAllocation set

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Implementing Workflow and Client Extensions for
AutoAllocations

Example:

Generate allocation transactions

Require approval

Release transactions

Use workflow to
automate the Distribute costs
execution of step-
down allocations Update project summary amounts
sets.

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 Agenda

• Allocation Rules
• Process Allocations
• AutoAllocations
• Process AutoAllocations

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 Submitting an AutoAllocation Set

ADMINISTRATIVE AUTOALLOCATION SET

Allocate posted GL
Enter and post balance to all projects
recurring GL with a particular project
journal owning organization

Example AutoAllocation

To run the entire series of allocations, you must

run the Workflow Background Process for the GL
AutoAllocation item type.

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Viewing the Status of AutoAllocation Sets

View allocation
statuses

Steps

Allocation Step detail Monitor

workbench workflow

View AutoAllocation status

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 Summary

In this lesson, you should have learned how to:

• Describe the purpose of allocation rules
• Create allocation rules and generate draft allocation
runs
• Define AutoAllocations rules in Oracle Project Costing

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