The Cost-plus invoicing functionality allows you to make the sales price dependent on the costs incurred, for example in the case of secondments, additional construction work, or the creation of a prototype. Based on actual costing data, such as actual costs, hours and quantities, you determine the sales price and ultimately the invoice sum. This pricing method is also referred to as 'pricing based on actual costs'.
The cost-plus invoicing method depends on the part type:
For purchase and production parts, you invoice on an actual costing basis. The price of the goods delivered is determined when the (commercial) actual costing process is complete. The actual costing specification is not printed on the invoice.
For costs and services, you use cost-plus specification invoicing. The specification of the costs incurred are printed on the invoice, so that the customer can see the costs that make up the invoice amount.
Cost-plus specification invoicing is used, for instance, when your company has been asked to resolve a failure. A sales order line has been created for part X, with the description 'Failure resolution'. The invoice shows the following:
Line 001 Part X Failure resolution $ 1,000
Materials used
Pump
1 piece
at $ 700
$ 700
Hours worked
Hours
2 hours
at $ 100
$ 100
Costs incurred
Travel
200 miles
at $ 0.50 per mile
$ 100
To use cost-plus invoicing, select the appropriate option in the Sales module (Sales offers or Sales orders form, Invoicing tab, Lines button). This is the tab from which the cost-plus invoicing procedures are controlled.
The cost-plus method for invoicing purchase or production parts results in an invoice where the price of the production or purchase part is based on the cost-plus specification. The order of the steps is not fixed. The order may vary, as the actual costing may well be performed after the parts have been delivered. In that case, you will also create the cost-plus specification afterwards, and settle the invoice recommendations when creating a final period invoice.
If you invoice following a delivery, the procedure would be as follows:
In the Sales module, enter a sales order and a sales line.
Collect the actual costing information by posting hours, issuing parts, etcetera.
The cost-plus method for invoicing costs and services results in an invoice that shows the cost-plus specification you have composed based on the production order. The order of the steps is fixed, with the exception of the time of releasing the cost-plus specification for invoicing purposes. The consecutive steps are:
In the Sales module, enter a sales order and a sales line.
Collect the actual costing information by posting hours, issuing parts, etcetera.
Create an invoice recommendation for the sales line. It is automatically linked to the cost-plus specification of the sales line, and also shows the sum specified in the cost-plus specification.
Where necessary, unlink the invoice recommendation and the cost-plus specification in order to make changes, and then re-establish the link.
The 'Multiple debtors per sales offer or order' functionality enables you to change the debtor on an order. This way, all revenues and costs will fall under the same order, and the order profit will be clear at a glance.
The 'Multiple debtors per sales offer or order' functionality makes it easy to:
Change the debtor data on an invoice recommendation
Invoice cost-plus specification lines of a sales offer or order to more than one debtor (amount split among multiple debtors)
Invoice a cost-plus specification line of a sales offer or order to another debtor than the debtor specified in the offer or order (assignment to another debtor)
Credit and re-invoice cost-plus specification lines.
The debtor data on the invoice recommendations originate from the sales order. You can change these data on the invoice recommendation (Debtor data tab), except when you are using periodic invoicing. If debtor data are changed when periodic invoicing is used, the invoicing situation would become unclear.
Example of amount split among multiple debtors:
A customer takes his car to a workshop for it to be repaired. He bought the car a year ago and the warranty period has just expired. Out of goodwill, the workshop gives a 30% discount on the repair. The customer is now the debtor of 70% of the sum to be invoiced. The workshop takes the remaining 30%, which means it is now also a debtor.
Example of assignment to another debtor:
Two weeks later, the customer discovers that one of the doors is not working properly either. The door has to be replaced. In order not to lose the customer, the garage decides to charge the customer for only part of the repair sum. The customer only pays for the labor. The dealer who sold the car with the defective material will foot the bill for the new door.
The steps for assigning multiple debtors to a sales offer or order are embedded in the sales flow procedure. In general, you will complete the following steps:
Create sales offers
Create sales orders
Create sales lines for a service, for example 'After-sales service'. On the Invoicing tab, the cost-plus invoicing type 'Cost-plus specification invoicing' is selected automatically.
Create production files
Create and register costs: post hours, register material usage, etcetera.
Create cost-plus specification lines The prices are based on the actual costing.
Choose from the following options:
Assign cost-plus specification lines to a different debtor using the Assign and split process. Select one or more cost-plus specification lines for the assignment, and select another debtor to charge the full sum to.
Manually assign cost-plus specification lines to another debtor: Enter '0%' in the Debtor share field on the cost-plus specification line to indicate that the customer does not have to pay anything. Then create a cost-plus specification line for the new debtor, and enter '100%' in the Debtor share field.
Split cost-plus specification lines among multiple debtors using the Assign and split process. This process allows you to specify the percentages the different debtors have to pay for one or more cost-plus specification lines.
Split cost-plus specification lines among multiple debtors using the Split quantity among multiple debtors process for one cost-plus specification line relating to a part.
Manually split the cost-plus specification lines among multiple debtors: in the Debtor share field on the cost-plus specification line, specify the percentage to be paid by the customer, for example 70%. Then manually create a cost-plus specification line for the remaining 30%.
Create invoice recommendations
Create invoices
Create credit lines and new invoices Use the Create cost-plus lines to credit and re-invoice process to create new cost-plus specification lines: credit lines for the invoiced cost-plus lines and/or lines with other debtor data for which you want to create new invoices.
Recreate invoice recommendations based on the credit lines and the cost-plus specification lines with the other debtor, price customer and/or price
Recreate invoices based on the invoice recommendations with the other debtor, price customer and/or price
In addition to the usual forms involved in cost-plus invoicing, the forms relevant when the 'Multiple debtors per sales offer or order' setting is used are:
It is not possible to change the values in the Debtor, Payment condition, Price customer and Invoice address fields when the sales offer or order (Sales module) has one or more underlying cost-plus specification lines. You can change these values, however, by opening the Edit menu, and selecting Change offer or order data.
If a sales line (Sales module, Sales offers and Sales orders forms, Lines button) has underlying cost-plus specification lines containing one or more debtors other than those entered in the sales order, it is not possible to mark the sales line for periodic invoicing. If debtor data are changed when periodic invoicing is used, the invoicing situation would become unclear.
The VAT code can be changed on the sales line. This change will be applied to all underlying cost-plus specification lines with the same VAT code as the sales line. If a sales line has an underlying cost-plus specification line with a different VAT code, this cost-plus specification line will not be changed. When trying to change the VAT code on the sales line, the following warning will be displayed: NOTE: Cost-plus specification lines with different VAT code found. They will not be changed.
The section below lists the tab-specific changes to the Cost-plus specification form (Sales module, Sales offers and Sales orders forms, Lines button, Cost-plus specification button).
List tab:
Cost-plus specification lines can be changed on the List tab. Changing lines on this tab is easy and convenient. For example, the tab allows you to quickly assign the sums to be invoiced to various debtors.
The Created column shows whether the line is the result of manual entry, creation of a cost-plus specification, splitting, assigning, or crediting and re-invoicing.
The Source code field is used to sort cost-plus specification lines in a logical manner. Let's assume you run a process to assign the cost-plus specification lines underlying a sales line to a different debtor. As a result of the process being run, 100 new lines are created. For both the original lines and the new lines, you want to see which lines are related. Lines 1 and 101 are both based on the same actual costing line(s), and will therefore be given the same source code. They might have the same part, but different debtors. Lines 2 and 102 are related, lines 3 and 103 are related, etcetera. By sorting on source code, you will always see the related lines grouped together, which gives you a convenient overview and makes it easier for you to make changes.
General tab
The fields on the General tab can be changed only if the cost-plus specification lines are not linked to an invoice recommendation or sales invoice line.
The informational Debtor field shows the debtor to whom the line is invoiced. This value can be changed on the Debtor data tab.
The Debtor share field shows the percentage of the subtotal invoiced to the debtor.
The sum eventually invoiced to the debtor is shown in the Total sum field. The sum is calculated as follows: Subtotal * Debtor share %, for example 54.00 * 50% = 27.00. You can change the total sum, where necessary.
The Reason field allows you to indicate why all or part of the invoice sum is assigned to another debtor. Possible reasons include goodwill.
In the VAT code field, you can enter a value different from the value in the parent sales line, for example if a different VAT rate applies to a assembly component. If you are using periodic invoicing, it is not possible to enter another VAT code. If the VAT code on the Invoice recommendations form changes, the VAT code on the cost-plus specification line will also change automatically.
To indicate that the cost-plus specification line has been corrected, select the informational 'Corrected' check box. You may want to do so after selecting an alternative debtor to whom the line is to be invoiced.
To indicate that the cost-plus specification line has been reviewed and approved, select the informational Reviewed check box. When executing the Change offer data and Change order data processes, you can choose to apply changes only to unreviewed lines (Sales module, Sales offers and Sales orders forms, Edit menu, Change offer or order data option, Debtor data tab, Unlinked cost-plus specification lines field).
Debtor data tab
The Customer field shows the code of the price customer for whom the price search path is filled in order to determine the sales price. By default, this field contains the price customer from the sales line. You can change the field only if 'Part' has been selected in the Type field on the General tab. When you change the price customer, the sales price does not automatically change as well. You need to run the Re-run pricing process from the Edit menu.
In the Debtor field, select the debtor to whom the total sum is to be invoiced. By default, this field contains the debtor specified in the sales order.
The default address in the Invoice address field is the invoice address of the selected debtor.
By default, the Payment condition field contains the payment condition that applies to the selected debtor.
You can change the values of the Debtor, Payment condition and Invoice address fields only if the following conditions are true:
'Cost-plus specification invoicing' is selected in the Cost-plus invoicing type field on the sales line.
The cost-plus specification lines are not linked to an invoice recommendation or sales invoice line.
The sales line is not marked for periodic invoicing.
When changes are made to the values of the Debtor, Invoice address and/or Payment condition fields on the Invoice recommendations form, the values of the corresponding fields on the cost-plus specification line will automatically change as well.
Run the Change offer data and Change order data processes to specify how changes to the sales offer or order must be applied to the cost-plus specification lines.
If you change the VAT code on the General tab, the VAT code on the linked cost-plus specification line will also change automatically.
Debtor data can be changed on the Debtor data tab. When changes are made to the values of the Debtor, Payment condition and Invoice address fields, these values will also change in the linked cost-plus specification.
If you change the debtor, the corresponding payment condition and invoice address will be filled in automatically. These values can be changed if required.
The values of the Debtor, Payment condition and Invoice address fields cannot be changed if the invoice recommendation is intended for a sales line marked for periodic invoicing.
Run the Change offer data and Change order data processes to specify how changes to the sales offer or order must be applied to the invoice recommendations.
Sales module, Sales offers and Sales orders forms, Lines button, Cost-plus specification button, Edit menu
The Default values for cost-plus specification lines section contains the default values 'Corrected' and Reviewed'. They are the default values to be used in the corresponding fields on the new cost-plus specification lines.
Running the process ensures that the following fields on the new cost-plus specification lines are assigned a value:
Debtor: This value is copied from the sales order.
Payment condition: This value is copied from the sales order.
Invoice address: This value is copied from the sales order.
Price customer: This value is copied from the sales line.
VAT code: This value is copied from the sales line.
If 'Not applicable' or 'Pricing based on actual costs' is selected as the cost-plus invoicing type on the Invoicing tab of the sales line, the values of the Debtor, Payment condition and Invoice address fields on the invoice recommendation are copied from the sales order. The VAT code is copied from the sales line.
If 'Cost-plus specification invoicing' is selected as the cost-plus invoicing type on the Invoicing tab of the sales line, the values of the Debtor, Payment condition and Invoice address, and Invoice address fields on the invoice recommendation are copied from the cost-plus specification line.
In principle, the settings you specify for the invoicing grouping level on the Cost-plus specification types form (Sales module, Basic sales data folder) determine which types of cost-plus specification lines are to be linked to an invoice recommendation. For example, if you choose to group cost-plus specification lines of the 'Part' type on a single invoice recommendation, all cost-plus specification lines of this type will be grouped on one invoice recommendation. If, however, the values of the Debtor, Payment condition, Invoice address, and VAT code fields are not the same for all lines, a new invoice recommendation will be created for the line that has a different value. If, for instance, two cost-plus specification lines of the 'Part' type have different debtors, separate invoice recommendations will be created for each of these two debtors, because a cost-plus specification line with a different debtor has to result in a new sales invoice.
Use the Process shipping notes process (Shipping module, Processes folder) to create invoice recommendations. The values of the Debtor, Invoice address and Payment condition fields are copied from the sales order.
Use the Create sales invoices process to create sales invoices. The values of the Debtor, Invoice address and Payment condition fields are copied from the invoice recommendation. If invoice recommendations have different debtors, payment conditions, or invoice addresses, new sales invoices are created for these invoice recommendations. Whether and how invoice recommendations are combined on a sales invoice is controlled by the value of the Create invoice field (Customers module, Customers form, Customer card tab).
Use the Change offer data and Change order data processes (Sales module, Sales offers and Sales orders forms, Edit menu) to change the Debtor, Payment condition, Price customer and Invoice address fields in a sales offer or sales order that has one or more cost-plus specification lines.
To configure whether and how the values of the Debtor, Payment condition and Invoice address fields are to be copied to the cost-plus invoicing specification lines or invoice recommendations, use the Debtor data tab. On cost-plus invoicing specification lines for which sales invoices have already been created, the fields are not changed with this process. The different options are described below.
In the Unlinked cost-plus specification lines field, choose the settings to be used for cost-plus invoicing specification lines for which no invoice recommendation has been created yet:
All cost-plus specification lines: All unlinked cost-plus specification lines underlying the selected sales order are changed.
Unreviewed cost-plus specification lines: Only unreviewed, unlinked cost-plus specification lines underlying the selected sales order are changed.
Cost-plus specification lines with matching data: Only unlinked cost-plus specification lines underlying the selected sales order that have the same data as the sales order (i.e. the same debtor, payment condition and invoice address) are changed. Any lines with different values are not changed.
Unreviewed cost-plus specification lines with matching data: Only unlinked cost-plus specification lines underlying the selected sales order that have not been reviewed yet and that have the same data as the sales order (i.e. the same debtor, payment condition and invoice address) are changed. Any lines with different values are not changed.
No cost-plus specification lines at all: None of the unlinked cost-plus invoicing specification lines underlying the selected sales order are changed.
In the Invoice recommendations field, and on the cost-plus invoicing specification lines linked to this field, you can choose the settings to be used for invoice recommendations and cost-plus invoicing specification lines for which an invoice recommendation has already been created:
All invoice recommendations: All invoice recommendations for the selected sales order are changed (except for those subject to periodic invoicing), including the linked cost-plus invoicing specification lines.
Non-authorized invoice recommendations: All non-authorized invoice recommendations for the selected sales order are changed (except for those subject to periodic invoicing), including the linked cost-plus invoicing specification lines.
No invoice recommendations at all: None of the invoice recommendations for the selected sales order are changed, and neither are the cost-plus invoicing specification lines linked to them.
Cost-plus invoicing of purchase and production parts