Project Management, Invoicing
This tutorial covers:
Labour costs are a major component in a contract. To understand the options available in Epic for pricing tasks you must understand the different means that Epic provides for monitoring labour costs.
The simplest choice is between monitoring direct manhours, or monitoring labour costs. Epic presents four manhour figures for each task; an estimated value (if any), total ordinary hours, total overtime hours, and the sum of these two totals. The distinction between 'normal' and overtime hours is made during manhour entry. Epic can record any number of different labour rates, but for labour tracking purposes, each is categorised as either a 'normal' or an 'overtime' rate.
If instead you to choose to monitor labour costs, a further choice has to be made. You can track 'actual' labour costs, as reported by your payroll system, or a 'calculated' labour cost. Epic is not a payroll system and does not record all information necessary for payroll*. However it can import data from a payroll system to present a completely accurate labour cost figure. If such data is not available Epic can instead calculate a labour cost. To do so it takes the total normal and overtime hours and multiplies each by a project-specific rate. This rate is set by the user and can be changed at any time. This allows labour costs to be tracked against a notional market rate.
* : Epic can be used to feed manhour data to a payroll system.
As a final utility Epic can present an effective rate for each of these cost options. This rate is simply the appropriate cost divided by the total hours. Hence the following labour cost figures is available for each task. Please note that you are expected to choose which options are most useful yourself rather than try to use all of them!
|Estimated manhours||estimated manhours (if any)|
|Estimated labour cost||estimated labour cost (if any)|
|Estimated rate||estimated labour cost / estimated manhours|
|Hours||actual manhours (recorded via manhour entry or imported from payroll system)|
|Overtime hours||actual overtime manhours (recorded via manhour entry or imported from payroll system)|
|Total hours||hours + overtime hours|
|Actual labour cost||actual total labour cost (imported from payroll system)|
|Actual labour rate||actual labour cost / total hours|
|Calculated labour cost||(actual manhours x user defined rate) + (actual overtime hours x user defined overtime rate)|
|Calculated labour rate||calculated labour cost / total hours|
One of the most useful features of Epic is the ability to define task alerts based on combinations of these figures.
Now that we understand labour costing we can progress to setting prices on tasks.
Task prices are set via the tasks list on the 'Tasks' tab of the project editor. Task pricing is available once a project reaches the 'Work Ongoing' stage.
Only customer tasks have prices. However, under exceptional circumstances you can decide to set prices at the yard task level (see yard task pricing).
By default a task's price is not editable until the task is completed or cancelled, though changing a user preference allows you to edit the price of incomplete tasks ('Your Preferences / Invoice Generation / allow price to be set before task is completed").
Task prices can be one of five values:
The prices of estimated tasks start out either fixed or calculated (depending on your choice when they are imported), whilst emergent tasks always start out as calculated. Once editable, the user can change how a price is set by changing the values in the 'Price Calc' column of the task list in the project editor:
Choosing 'manual' makes the 'Price' column editable, otherwise this column cannot be edited.
Choosing 'tariff' means that the price is based on the total tariff costs for that task and its children yard tasks. Note if yard task pricing is enabled, the tariff cost counts only the tasks own tariff items.
The calculated price for a task = [(labour cost) x labour markup] + [total purchases x purchase markup] + [total subcontracts x subcontract markup] + [all tariff items' prices]
These 'markup' values are adjustments applied to each total. These default to values set in user preferences ('Your Preferences / Invoice Generation / Cost Markups for Price"). However they can be changed for each project by switching to the project editor's 'Project' tab and opening the 'Task Pricing' section. The current values are displayed under 'Cost Markups for Price', and if you switch to the read-write Project editor, can be modified. Markups are examples of 'adjustment' fields with their own particular syntax.
The 'Task Pricing' section also defines how the labour cost is calculated. By default it uses the actual labour cost imported from payroll records. However if these are not available, or you wish to price according to a defined rate, you can tick 'use calculated labour costs' and then enter the rates at which you wish normal and overtime hours to be priced. You will have to be in the read-write project editor to do this.
Note that markups, labour rates and how labour cost is calculated can be changed whenever you wish.
The final option for a task price is to apply an adjustment to the calculated value. The 'Price Calc' column is also an adjustment field so you can clear the 'estimate', 'manual' or 'calculated' text and add an adjustment that is applied to the calculated price.
Yard Task Pricing
The definition of a yard task is one that the customer does not see. Hence all yard task costs and prices are rolled up to their parent customer task. However you can set Epic to allow yard task prices via user preferences ('Your Preferences / Invoice Generation / allow projects to include prices at yard task level"). This is not recommended as it can lead to confusion on overall costs. However this can be down where you wish to include line item detail in invoices generated by Epic.
If you do choose to set yard prices explicitly, note that the price of the parent customer task includes the yard tasks prices. When you generate the invoice you are then offered the option 'show customer task prices exclusive of yard task prices'.