8.10.3 Monthly Contribution Maintenance (08904m)

Muli uses the words “Project Contribution”, not Project profit, as projects make a contribution to Overheads - only after Overheads have been paid, does a profit emerge.

Earned Value Project Management:

For traditional construction projects, contribution recognition is calculated on an “Earned Value Basis” where total income is projected to completion (after taking into account the Risk that Unapproved Variations may not get paid by a Client),

Less project final forecast cost (which takes into account the total risk outstanding in completing a project to the Client's requirements),

Equals predicted final contribution.

By taking approved costs divided by final forecast, we identify the % complete.

Predicted final contribution x % complete = Earned Value

Users should review each project to ensure taking up Earned Value, which becomes part of project cost.

Project Prepayment = Received Income (-) Project Cost. If this is -ve you have -ve prepayment and should be reviewed by management to confirm the recognised value is realistic in relation to the project under review.

The contribution maintenance screen also shows the traditional invoiced - expense presentation of project recognition for use on net traditional project for contribution recognition. Income - Expense is the Traditional Accounting approach, which is useful to guide management so that they don't overclaim the Contribution Earned (refer Question 4) 

1. Project - Enter the project number

For each project you enter "Management Adjustment Values"as follows:

2. Management Accrual Amount: By default this will be the value of accruals processed for the period but may be overwritten by an authorised person. An accural is for wrok done but not yet approved for payment.
3. Management Predicted Final Contribution: This is the conservative value that management will post as Contribution to Overheads at the end of the project. It is the difference between income and payments made to Suppliers, for Equipment Rental, Payroll and Subcontractors. 
4. Management Earned Value: Default is %complete x management final contribution and may be overwritten.
5. Turnover to financial year end: Muli will default a value which may be overwritten by the User. Turnover looks at apportioning the value still to be approved on teh project between now and Project Completion - and adds this to the already approved amount.