Understanding rate calculations in time entry

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Determining the rate

In time entry, the Rates drop-down list contains all of the rate descriptions assigned to the staff member for which time is being entered. The rate that is used for the time entry transaction is determined by the client / engagement, staff, and activity.

Note: Engagement, Activity, Client, and Staff are firm terminology variables. Your firm might refer to these items by different names. To view the default terminology for any screen or field, choose Enable Default Terminology from the Help menu (or press CTRL+SHIFT+H).

The following steps are used to determine the rate, in this order.

  1. The application checks the rates that have been set up for the client’s engagement (Setup > Clients > Engagements tab).
    • If the engagement has No Engagement Rate selected, the application checks the activity for the rate.
    • If Staff Rate is selected, the application checks the staff’s rate table for the rate assigned to the engagement. If the staff has that rate assigned, the application uses that rate for the rate calculation. If not, the application checks the activity for the rate.
    • If Fixed Rate is selected, the application uses the fixed rate you have set up for the engagement.
  2. The application checks the rates that have been set up for the activity (Setup > Activities > Main tab).
    • If No activity rate is selected when the activity is set up, the application uses the rate you select for the entry. If you do not select a rate for the entry, the application will not allow you to save the record.
    • If Staff rate is selected for the activity, the application checks the staff’s rate table. If the staff has that rate set up, the application uses that rate for the rate. If not, the application uses the rate you select for the entry. If you do not select a rate for the entry, the application will not allow you to save the record.

Note: The correct staff rate is determined by comparing the date of the time entry to the effective date of the staff rates table. See Setting up staff rates for further information on determining staff rates.

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Calculating the amount

The Amount field is a calculated currency field. If you do not have security permission to view WIP amounts, this field is hidden in time and expense entry.

Note: Staff with the appropriate security permission can override the amount, if necessary. When an amount is overridden, it appears in red. Amounts that you override cannot be recalculated by the application; amounts can only be changed manually.

The Amount field is calculated using the following method.

  1. Multiply the hours by the hourly rate. If you are entering time in minutes, the application converts the time to hours.
  2. Multiply by the engagement’s markup / markdown factor (as entered in Setup > Engagement Templates).
  3. If the activity used in the transaction is set up for the amount to be rounded, the application rounds the amount to the nearest dollar using standard rounding. If the activity is not set up to be rounded, the amount will be rounded to the nearest penny using standard rounding.

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