WINLine Cost Accounting Juni 2005 COST Accounting Data

® WINLine Cost Accounting Juni 2005

COST Accounting – Data From: Ø Ø Ø ACC 1 ACC 2 ASSET PAYROLL PROD Juni 2005

Concepts Ø Entry of costs • Mostly in ACC 1 Ø Cost Distribution • Distribution of costs/revenues to organizational units (cost centers) Ø Cost Allocation • Allocation of costs to operational projects (cost objectives) Juni 2005

COST Procedures Ø Full cost accounting • All costs are distributed to the cost centers and cost objectives Ø Partial cost accounting • Only costs directly caused by a cost objective are distributed to the cost objective Juni 2005

Time Aspect Ø Actual cost accounting • Comparison of the actually incurred costs in a past period of time Ø Planned cost accounting • Future costs will be planned Ø Target cost accounting • Analysis of ACTUAL units based on budget calculation rates Juni 2005

Cost Type Organization Ø According to contributing source • • Material costs Worker costs Energy costs etc. . Juni 2005

Cost Type Organization Ø According to use: • Variable costs • Fixed costs • Variable overhead costs Juni 2005

Cost Type Organization Ø According to Type of Entry • Direct Costs • Direct costs, e. g. , piece wages, raw material direct costs, etc. • Indirect costs • These costs cannot be attributed directly to a cost objective (e. g. , administrative and marketing costs) Juni 2005

Variator Ø The variator defines the proportion of cost that is variable • 0 = 100 % fixed costs • 10 = 100 % variable costs • 7 = 70 % variable costs Juni 2005

Index Ø Permits the conversion of expenses into costs (during posting) Ø Example: • Acquisition value = 10, 000 • Replacement value = 15, 000 • Index = RV/ AV * 100 = 150 Juni 2005

Cost Centers Ø Organizational units within a business Ø Divisions: • Main cost centers Production • Administration/Marketing • • Indirect Cost Centers • Holding units that are entirely allocated Juni 2005

Calculated Costs Ø Cost types can be calculated per cost center based on previously defined basic cost types (e. g. , payroll secondary costs based on incurred piece wages) Juni 2005

Cost Objectives Ø Distribution of direct costs Ø Pre-calculation based on past values (Budget. Overhead burden rates) Ø Post-calculation based on the overhead burden rate calculated in the Expense Allocation Sheet Ø Period (duration) Juni 2005

Allocation Ø There are five tab areas in the menu item: • METHOD (one-time setup) • PLAN (one-time setup) • ALLOCATION (automated allocation suggestions based on current allocation percentages) • 13. Period – for monthly aliquote calculations (e. g. , from asset management) • VOID (Cancel allocation without recalculation) Juni 2005

Cost Allocation Ø Automatic suggestion of all existing allocation plans. • The system date is suggested as posting date. Manual change is possible. • Posting period from the Company Base Info is suggested. More than one period can be selected. • Allocation can be executed as often as desired. Any previous allocations are deleted and a new total allocation period is calculated. Juni 2005

Allocation - Method Ø One-time definition of allocation method • Recieving cost centers: Definition of cost centers to which entered costs that have temporarily been held in “Indirect Cost Centers“ will be allocated. • Entry of cost type that should be employed as calculation basis. • Calculation basis formed based on posting amount or unit is possible. Juni 2005

Calculation Basis-Verh. zahlen Ø Calculation basis is formed based on the percentage porportion of receiving cost centers. • Based on posted costs • Based on posted revenues • Based on posted units (hours, kg, m²) Ø The calculated proportion factors can be queried with the PROPORTION FACTORS button. Juni 2005

Allocation - Plan Ø One-time setup of the cost centers that should be allocated. • Allocation method: Selection of an existing method (source cost center and destination cost center for allocation). • Indirect cost centers: Entry of indirect cost center to be allocated. • Cost types: To allocate individual portions of a cost center, it is possible to restrict to particular cost type areas here. • Allocation cost type: To easily identify allocation lines, it makes sense to assign an individual allocation cost type. Juni 2005

13. Period Ø Postings from Period 13 (e. g. , depreciation from ASSET) • These postings are automatically allocated spread over all fiscal year periods on an aliquote basis. Juni 2005

Allocation – Void Ø All executed allocations period are shown in the Void tab area. • During cancellation, allocation lines of the selected period are deleted. • And the new allocation is not automatically calculated (this would normally occur when allocation is executed again for the period). Juni 2005

Planned Costs Accounting ØSetup of a planned cost type with units and a provisory costing rate per unit (e. g. , hourly rate) ØBudgeting of cost centers/cost objectives by unit planned costs (planned units, planned rates) ØEntry of ACTUAL units (hourly billing, etc. ) Target costs (ACTUAL units to planned rates) ØAllocation based on performed units results in a ACTUAL rate ACTUAL costs (ACTUAL units at ACTUAL rates). Juni 2005

WINLine® ASSET Basis Seminar Juni 2005

Scope of Functions Ø Depreciation • annual • periodic Ø Asset Overview/Depreciation Preview Ø Asset Base Info Ø Acquisitions/Disposals Ø Unit values Ø Investment allowance list Ø Valuation Reserves Juni 2005

ACC 1 Interface Ø Automat. adoption of tax-based depreciation to ACC 1 Ø Adoption of period depreciation to ACC 1 Juni 2005

COST interfaces Ø Automat. Adoption of implicit depreciation to COST (based on repurchase value, or implicit useful life, allocated to periods) Ø OR: As as alternative, an adoption to COST with the book values from ACC 1 can be executed. Juni 2005

Asset Parameter Ø Ø Ø Ø Default posting account for depreciation Default depreciation rules Lower limit unit value % Useful life in months Reminder value option IA update for selected asset groups Info on last implicit or tax-based depreciation run Post costs with ACC 1 Juni 2005

Asset Categories Ø Ø Ø Ø Ø Default for stock merchandise: ACC 1 account Vendor Inventory description Useful life Asset type (LV asset, etc. ) Default deprec. rules IA, accel. deprec Write-off type Juni 2005

Data Entry Ø Acquisitions • A new asset is posted either as separate inventory object or as a sub-asset to an existing asset. Juni 2005

Data Entry Ø Partial value disposal • A portion of asset value is lost (damage, sale, value depreciation, . . . ) • Automatic calculation of disposal value (BV and depreciation) • Recalculation of remaining book value and new annual depreciation Juni 2005

Data Entry Ø Transfer • An asset value is transferred to another asset (e. g. , activation of building under construction to a Building) • Automatic recalculation of book value and annual depreciation Juni 2005

Data Entry Ø Disposal • An asset is completely disposed of (i. e. , is automatically posted off the books) • Automatic calculation of disposal depreciation and disposal value based on BV and asset value Juni 2005

Data Entry Ø One-time (extraordinary) write-ups/write-offs Ø Asset Modification • Correction of existing Base Info in case of commercial obsolescence, damage, regulatory change, or unforeseeable losses in value, etc. Juni 2005

Data Entry Ø Performing tax-based depreciation • periodic (monthly, quarterly, etc. ) • At year’s end, whereby all values for periodic depreciation are automatically corrected and reposted based on the current asset conditions. Juni 2005

Theoretical Considerations Ø Depreciation • Distribution of acquisition or production costs over the useful life • For acquisitions after 1. 1989, you can no longer apply accelerated depreciation Juni 2005

Theoretical Considerations Ø Valuation guidelines • Relaxed lower of cost or market principle Depreciable fixed assets (machines, office equipment, . . . ) • Non-depreciable assets (land, patents, investment paper) • Juni 2005

Theoretical Considerations Ø Accelerated Depreciation • Only applicable in exceptional cases since 1. 1. 89 (additional write-off of 40 % of asset value in year of acquisition) Juni 2005

Theoretical Considerations Ø Straight-line depreciation • Acquisition value/production costs are equally distributed over the useful life Ø Declining balance depreciation • Percentage of depreciation is not calculated from AV, but rather from residual book value Ø Graduated depreciation • Percentage that can be assigned over a period of several years. Depreciation is based on the acquisition value. Juni 2005

Theoretical Considerations Ø With a common asset management system – independent of country – all depreciation rules can be used. Ø The date of acquisition forms the basis • 0 – exact monthly deprec. calculation • 1 – semi-annual depreciation (A) Check whether acquisition was in first or second half of year and either six or twelve months depreciation, respectively. • 2 – annual depreciation Independent of acquisition, the entire annual depreciation is applicable. Juni 2005

Theoretical Considerations Ø Declining balance depreciation – with automatic switch to straight-line depreciation Ø Graduated depreciation – for fixed business assets (buildings) – separate depreciation graduations Ø Special depreciation – in first two years up to 20 % of acquisition value can be applied in addition to annual depreciation. Ø “Pro ratio temporis“ rule / simplifications rule Juni 2005

Theoretical Considerations Ø Consumption depreciation • Depreciation amounts are based on consumption rate values of asset (e. g. , gravel pit) Ø Extraordinary depreciation • Extraordinary depreciation, i. e. , the asset value may be decreased by a partial value (see lower of cost or market principle) Juni 2005

Theoretical Considerations Ø Date • Acquisition date • Relevant for posting of investment allowance • Date of start-up • Relevant for depreciation calculation (semiannual rule) Juni 2005

Theoretical Considerations Ø Low-value Assets • Depreciable assets whose AV or production costs do not exceed ATS 5, 000 (excl. VAT) • Can be written off 100% in year of acquisition • The unit value is decreased for five running years by 20 % respectively Juni 2005

Theoretical Considerations Ø Investment Allowance • An investment allowance of X % (depending on type of asset and date) can be applied to reduce profits. • The asset must have a minimum useful life of four years and be used domestically. • The IA can only be applied to acquisition costs or production costs that occur before December 31, 2000. Juni 2005

Theoretical Considerations Ø Investment allowance • After a period of four years the IA is posted tax-free to the capital account (or taxable reserves account) • If the asset is disposed of within four years, a penalty of 5% annually is payable on the IA Juni 2005

Theoretical Considerations Ø Investment Reserves • Dissolving the IR occurs by acquisition of assets with the amount that can be applied as IR. • If the IR is not fully consumed within four years, the remaining portion is to be dissolved as increase in profit with a penalty of 5% annually. Juni 2005

Theoretical Considerations Ø Valuation reserves • For this reason, hidden asset reserves that have belonged to corporate assets for a minimum of seven years can be transferred to a “same type” asset within three years (decreasing acquisition value and therefore also annual depreciation) • If not transferred within three years, dissolution is performed with a penalty of 5% annually to increase profit. Juni 2005

Theoretical Considerations Ø Dissolution of Valuation Reserves • Reserves of accel. depreciation • After write-off of acquisition value, this can be annually dissolved to increase profit • Hidden reserves • This can be dissolved in same proportion of annual depreciation to acquisition value. Juni 2005