Infor LN Financials User Guide

for Controlling
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Publication Information

Document code tfcontrollingug (U9635)

Release 10.5 (10.5)

Publication date June 23, 2016

Table of Contents

About this document

Chapter 1 Deviations............................................................................................................................7
Deviations.....................................................................................................................................7
Occupation deviation..........................................................................................................7
Consumption deviation.......................................................................................................7
Over/under-coverage..........................................................................................................7

Chapter 2 Cost Categories..................................................................................................................9

Using cost categories...................................................................................................................9
Create cost categories manually.........................................................................................9
Create cost categories by importing ledger accounts.........................................................9
Cost calculation of allocation relations..............................................................................10
Calculation........................................................................................................................12

Chapter 3 Allocations.........................................................................................................................15
Allocation relations......................................................................................................................15
Allocation keys setup..................................................................................................................15
Default allocation relations setup................................................................................................16
Consumption allocation relations setup......................................................................................16

Appendix A Glossary.........................................................................................................................19

Index
About this document
This document describes the process to set up and use the Financial Budgeting System and Cost
Accounting modules.

Assumed knowledge
Understanding this document is easier if you have some basic knowledge of the functionality of the
various logistic LN packages and Financials.

Document summary
This document is a compilation of the help topics for the Cost Accounting and Financial Budgeting
System modules that are listed under Infor LN, Financials, Online Manual Topics.

How to read this document

This document was assembled from online Help topics. As a result, references to other sections in the
manual are presented as shown in the following example:
▪ For details, refer to Setting up an integration mapping scheme. To locate the referred section,
please refer to the Table of Contents or use the Index at the end of the document.
Underlined terms indicate a link to a glossary definition. If you view this document online, clicking the
underlined term takes you to the glossary definition at the end of the document.

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Infor LN Financials | User Guide for Controlling | 5

About this document

6 | Infor LN Financials | User Guide for Controlling

Chapter 1
Deviations
1

Deviations
The following deviations may occur between actual and budgeted amounts in the Cost Accounting and
the Financial Budgeting System:
▪ Occupation deviation
▪ Consumption deviation
▪ Over-/undercoverage

Occupation deviation
Occupation deviation only applies to full-cost accounting systems.

▪ Quantity Based:

allowed costs - (budgeted performance quantity * total effective

rate/surcharge)

▪ Amount Based:

allowed costs - (surcharge base amount * effective surcharge)

Consumption deviation
Actual costs - allowed costs

Over/under-coverage
Full cost accounting (set in the Cost Accounting Parameters (tfcat0100s000) session).
▪ Quantity Based reference unit:

Infor LN Financials | User Guide for Controlling | 7

Deviations

(total budgeted cost surcharge rate - total effective rate/surcharge)

* performance quantity

▪ Amount Based reference unit:

(total budgeted surcharge - total effective surcharge) * surcharge

base amount * 100

Variable (marginal) cost accounting

▪ Quantity Based reference unit:

(variable budgeted cost rate/surcharge effective rate) * performance

quantity

▪ Amount Based reference unit:

(variable budgeted surcharge - effective surcharge) * surcharge base

amount / 100

Allowed costs:
▪ Quantity Based reference units:

(performance quantity * variable budget cost rate) + fixed budget

amount

▪ Amount Based reference units:

(surcharge base amount * variable budget cost rate) + fixed budget

amount

8 | Infor LN Financials | User Guide for Controlling

Chapter 2
Cost Categories
2

Using cost categories

Create cost categories manually
To create cost categories manually:
1. Create cost categories in the Cost Categories (tfcat0102m000) session.
2. Define the ledger account(s) related to the cost category, in the Ledger Accounts by Cost
Category (tfcat0103m000) session.

Create cost categories by importing ledger accounts

This method is based on the ledger accounts' sublevel and the parent-child structure.

To create cost categories by importing ledger accounts:

1. Start the Cost Categories (tfcat0102m000) session.
2. On the appropriate menu, click Import Ledger Accounts or click Import Parent Ledger
Accounts.
All ledger accounts with sublevel zero will be imported and created as a cost category related to the
ledger account.

Example of imported ledger accounts

Source Created cost categories

Account Sublevel Cost Category Account by Cost

Category

Infor LN Financials | User Guide for Controlling | 9

Cost Categories

1000 1

1001 0 1001 1001

2000 2

2100 1

2101 0 2101 2101

2102 0 2102 2102

Example of imported parent ledger accounts

Source Created cost categories

Account Sublevel Cost Category Account by Cost

Category

1000 -

1001 10 1001 1001

2000 - 2000 2100

2100 20 2100 2101, 2102

2101 21

2102 21

Cost calculation of allocation relations

The following calculation example of allocation costs uses a budget year allocation relation. The same
budget year allocation relation applies to budget period or actual allocation relations.
This data is defined:

10 | Infor LN Financials | User Guide for Controlling

 Cost Categories

Cost category 4711

Ledger account 5800, 5820

Single Dimension Budget per Year

Year 2013

Budget BUD

Dimension type 1

Dimension code ABC

Reference unit KWH

Ledger ac- Total Variable Fixed

counts

5820 (prima- 1,000 400 600

ry)

5830 (prima- 20,000 10,000 10,000

ry)

5800 (sec. 10,000 4,000 6,000

debit)

5810 (sec. 5,000 2,500 2,500

credit)

Performance quantity 100.0

Infor LN Financials | User Guide for Controlling | 11

Cost Categories

Allocation relation

Relation Budget year

Year 2013

Budget BUD

Source Destination

Dimension 1 1
Type

Dimension ABC ABC

Reference KWH KWH

Unit

Ledger Ac- 5900 5020

count

Allocation Type Quantity

Quantity 10.1

Valuated Portion variable

Cost Category 4711/No cost category

Calculation
With cost category 4711, the allocation costs are calculated by adding the amounts of ledger accounts
5800 and 5820. This is because they are present within the entered cost category:

(4,000 + 400) / 100.0 * 10.0 = 440.00

12 | Infor LN Financials | User Guide for Controlling

 Cost Categories

Without cost category 4711, the amounts of L/A 5800, 5820 and 5830 will be taken into account.
Secondary credit ledger accounts are always skipped. Finally, the calculated sum is divided by the total
performance quantity, and then multiplied by the quantity:

(4,000 + 400 + 10,000) / 100.0 * 10.0 = 1,440.00

Infor LN Financials | User Guide for Controlling | 13

Cost Categories

14 | Infor LN Financials | User Guide for Controlling

Chapter 3
Allocations
3

Allocation relations
You can maintain allocation relations between dimensions, carry out allocation procedures according
to relations, and integrate the resulting amounts into budgets or actual analyses.
Cost allocation structures that use the same set of destination dimensions often occur multiple times.
Therefore, you can define allocation rule sets to collect rules of different types for the automatic generation
of allocation relations.

You can create an allocation net based on:

▪ Allocation keys, as described in Allocation keys setup (p. 15) .
▪ Default allocation relations, as described in Default allocation relations setup (p. 16) .
▪ Consumption rules, as described in Consumption allocation relations setup (p. 16) .
An allocation key is a scheme to create allocation relations automatically if the source of the allocation
relations is known.
Default allocation relations serve as a template for allocation relations with repeating occurrences
regarding source and destination dimensions.
Consumption rules are used to generate outgoing allocation relations from a retrograde source according
to the roles that you define.

Allocation keys setup

To automatically create outgoing percentage allocation relations of the same type, you can define an
allocation key for the chosen allocation rule set and generate the respective allocation relations
accordingly. If the allocation structure occurs multiple times for different source dimensions, use an
allocation key to define percentage allocation relations to a group of destination dimensions.

To set up allocation keys, take the following steps:

1. In the Allocation Key Names (tfcat4105m000) session, create the allocation key names.

Infor LN Financials | User Guide for Controlling | 15

Allocations

2. In the Allocation Keys (tfcat4502m000) session, set up multiple allocation keys for allocation
rule sets. You can insert cost categories that you create in Step 3. In that case, choose distinct
value portions.
3. In the Cost Categories (tfcat0102m000) session, create the required cost categories.
4. In the Ledger Accounts by Cost Category (tfcat0103m000) session, link ledger accounts to
the defined cost categories. Use the cost categories in the default allocation relations.
5. Run the Generate Allocation Relations with Allocation Key (tfcat4202s000) session to generate
the allocation relations for each allocation key in turn.

Default allocation relations setup

You can use default allocation relations as the template for allocation relations that have a repeating
occurrence with regard to source and destination dimensions, which is applicable in different allocation
models (budget year, budget period, or actual model).
Default allocation relations can be qualitative (for example, the assignment of a building using square
meters as the cost driver) or quantitative. The quantitative allocation relations are used to assign the
costs of an activity to the final cost objects using the number of setups per cost object.

To set up default allocation relations, take the following steps:

1. In the Allocation Rule Sets (tfcat4101m000) session, create an allocation rule set.
2. In the Default Allocation Relations (tfcat4503m000) session, create default allocation relations
for source/destination combinations.
3. In the Cost Categories (tfcat0102m000) session, create the required cost categories.
4. In the Ledger Accounts by Cost Category (tfcat0103m000) session, link ledger accounts to
the defined cost categories. Use the cost categories in the default allocation relations.
5. In the Copy Default Allocation Relations into Allocation Relations (tfcat4203m000) session,
copy the default allocation relations into the allocation relations.
6. In the Copy Allocation Relations into Default Allocation Relations (tfcat4206s000) session,
copy the allocation relations into the default allocation relations (optional).
7. In the Print Default Allocation Relations (tfcat4403m000) session, display a report for your
default allocation relations (optional).

Consumption allocation relations setup

If the allocation net is consumption oriented, you can create allocation relations according to consumption
rules. Outgoing budget and actual allocation relations from a retrograde source can be generated
following user provided rules.

16 | Infor LN Financials | User Guide for Controlling

 Allocations

The aim is to have quantities on the allocation relations in tight relation to the performance quantity on
the destination, which enables you to backflush resource and process requirements from the source
dimension to the destination dimension by means of the retrograde calculation.

To set up the consumption rules allocation relations, take the following steps:
1. In the Allocation Rule Sets (tfcat4101m000) session, create an allocation rule set.
2. In the Consumption Rules (tfcat4504m000) session, define the rules for source/destination
combinations.
3. In the Budgets (tffbs0503m000) session, create a single dimension budget.
4. In the Budgets per Year (tffbs0505m000) session, insert your budget in the current year.
5. In the Flexible Budget by Year (tffbs1510m000) session, enter dimensions and reference units
(with the appropriate ledger accounts) for your budget.
6. In the Performance Budget by Year (tffbs1120m000) session, define a performance budget
per year and a performance quantity or surcharge base amount per year for your budget.
7. In the Generate Allocation Relations with Allocation Key (tfcat4202s000) session, create
allocation relations.
8. In the Allocation Relations (tfcat4500m000) session, check the created allocation relations
(optional).
9. Run the Retrograde Calculation (tfcat4213m000) session to perform the retrograde calculation
for your budget.
10. Run the Integrate and/or Post Cost Allocation Results (tfcat4211m000) session, to integrate
the results of the retrogade calculation into the budget.

Infor LN Financials | User Guide for Controlling | 17

Allocations

18 | Infor LN Financials | User Guide for Controlling

Appendix A
Glossary
A

appropriate menu
Commands are distributed across the Views, References, and Actions menus, or displayed as buttons.
In previous LN and Web UI releases, these commands are located in the Specific menu.

reference unit
A performance measure of a cost center and a calculation base to determine rates and surcharges.

Infor LN Financials | User Guide for Controlling | 19

Glossary

20 | Infor LN Financials | User Guide for Controlling

Index

Allocation keys setup, 15

Allocation relations, 15
consumption, 16
setup defaults, 16
appropriate menu, 19
Consumption allocation relations setup, 16
Cost allocation, 15
Cost categories
allocation cost calculation, 9
creating, 9
Default allocation relations setup, 16
Deviations, 7
reference unit, 19