HOW HAVE THE COST ALLOCATION PROCESSES CHANGED WITH THE IMPLEMENTATION OF CAMS?

Calendar Month vs. Pay Period Accounting

Closing activities will now be based on calendar month instead of pay period. This change will impact both labor and surcharge cost allocation as described below.

NOTE: See the Pay Period vs. Accounting Month Fact Sheet for more information.

Labor Estimates

Following the transition to calendar-month accounting, CAMS/CFS will compute labor estimates for pay periods that begin in one month but end in another (see example). CAMS will automatically estimate labor costs to the end of a month based upon the labor costs incurred in the previous pay period.

For example, this year Pay Period 19 extended from September 21st, 2003 through October 3rd, 2003.

The labor module in CAMS calculates estimates based upon a percentage of the previous pay period cost. In the above scenario, CAMS would generate an estimate for the labor costs to be incurred between September 22nd and September 30th, 2003 at the close of the calendar accounting month. The estimate would be for the seven days that fall in September, or 70% of the pay period (7 out of 10 days). In the example above, the labor estimate would be the average daily pay period cost from Pay Period 18 multiplied by seven days.

When actual labor costs are available at the close of the pay period, estimates will automatically reversed out. However, users should always treat estimated labor costs as actual costs.

NOTE: Although labor estimates are generated monthly, actual labor charges will still be applied on a pay period basis.

Surcharges

The process for recording surcharges will remain the same as current processes with the following three exceptions:

• Surcharges will be applied on a monthly basis instead of a pay period basis
• Contract grant surcharges will be applied to all documents, not just those over $25,000
• Building depreciation surcharges will be applied to Boulder and Gaithersburg locations at the same rate