Hi Team,
Someone know if somewhere , we’ve developp the gross margin on the activity of the project? Because in standard of IFS, the gross margin is calculate on the project not on the activity.
I’m asking that, because I’ve a customer who calculate for some of his project, the gross margin on the activity.
Thanks fr your feedback.
Best regards
Steve KIRO
Hi,
I am not sure if I understand your question right.
In IFS/Project, both costs and revenues are connected to project activity, so in theory you can report gross margin on project activity level.
It usually makes no sense, because while various costs can be easily attributed to various activities, it is not easy to attribute revenues in the same way.
In Revenue recognition mechanism, revenue can be recognized at task level (which could be equivalent of subproject), and in practice it is the lowest possible level to identify margin.
Hi Adam,
Yes as you say the costs and revenues are connected to project activity, but the standard grab tthe gross margin for the global project not activity by activity. Natively the standard by the functionnality of the revenue recongnition, give the gross margin project by project but not activity by activity.
So i was wondering if someone had delevelopp that.
As I mentioned, you have functionality of tasks in Revenue Recognition, but I am not sure if it suits your purpose.
The functionality of tasks will no suit for this requirement.
Thanks for your help :)
If you structure the CBS in a way that you can see the GM, you are able to select the Activity in the Project Forecast and see the GM per activity.
Refresh snapshot will give you the option to update the forecasts.
Hi,
On any activity you can see cost and rev.
For one of my clients - very simple use of a project, we set the revenue related cost element to be essentially a negative cost. In this world total cost = GM. I’m not suggesting you do that as a normal process.
But as you can see Adam is 100% correct, we have cost / revenue and other posted to an activity sequence (an activity). . You can then view that data anyway you want. In the below screen you can see different tabs for cost and rev. The cost / rev buckets is determined by the cost element. The cost element is then marked as cost or rev. As I wrote, one client had very very simple use of project and for this one client the revenue was reported in the cost tab. GM viewing was very easy. I’m not suggesting this for 99% of our clients. That 1 client it was a good solution.
A more common process would be to report that data as needed by the client. The details allow easy reporting.
Best regards,
Thomas
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