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Allocation Examples

This topic aims to help you understand how the Allocations process works by showing how you might use statistical and fixed allocations.

Example 1: Allocating IT Costs by Headcount (Statistical Allocation)

In this example, you have $8,000 of IT costs stored in GLA 6180 - IT Costs. These need to be allocated across your UK and US regions and their departments.

Dimension 1 contains your global regions (US and UK in this example) and Dimension 2 contains your departments. You have already set up a statistical basis that contains your global headcount for all departments.

Retrieve Source

Select “6180 - IT Costs” from the General Ledger Account field in Filter Group #1.
$8,000 is retrieved from that GLA.

Allocation Method

Select the Variable allocation method, because you are using a variable set of statistical values (headcount).

Statistical Basis Configuration

You have stored the following values in a statistical basis called “Global Headcount”:

Dimension 1	Dimension 2	Headcount Value
UK	Back Office	8
UK	Sales	10
UK	Marketing	2
UK	Consulting	22
US	Sales	6
US	Consulting	16
US	Back Office	3
		67

Select “Global Headcount” from the Statistical Basis picklist.
Select Dimension 1 and Dimension 2 in Distribution Fields.

The following percentages are calculated using your selected Distribution Fields and the “Global Headcount” statistical basis:

Dimension 1	Dimension 2	Headcount Value	Percentage
UK	Back Office	8	11.94
UK	Sales	10	14.92
UK	Marketing	2	2.99
UK	Consulting	22	32.83
US	Sales	6	8.96
US	Consulting	16	23.88
US	Back Office	3	4.48
		67	100.00

Distribution

Select “Source” from Copy GLAs from.
"GLA 6180 - IT Costs" is copied from the source data and will be used for the allocation distribution.

The percentages calculated on the Statistical Basis Configuration page are used to work out the distribution of the $8,000:

General Ledger Account	Dimension 1	Dimension 2	Headcount Value	Percentage	Amount $
6180 - IT Costs	UK	Back Office	8	11.94	955.20
6180 - IT Costs	UK	Sales	10	14.92	1193.60
6180 - IT Costs	UK	Marketing	2	2.99	239.20
6180 - IT Costs	UK	Consulting	22	32.83	2626.40
6180 - IT Costs	US	Sales	6	8.96	716.80
6180 - IT Costs	US	Consulting	16	23.88	1910.40
6180 - IT Costs	US	Back Office	3	4.48	358.40
			67	100.00	8,000.00

At this stage, you are ready to preview the allocation and enter the posting details.

Example 2: Allocate Office Rental Costs by Headcount (Statistical Allocation)

In this example, you have $10,000 of rental costs stored in GLA 6000 - Rent. These costs need to be allocated across departments in your UK region only.

Dimension 1 contains your global regions (US and UK) and Dimension 2 contains your departments. In this example, you filter out the US region stored in Dimension 1.

You have already set up a statistical basis that contains your global headcount for all departments.

Retrieve Source

Select “6000 - Rent” from the General Ledger Account field in Filter Group #1.
$10,000 is retrieved from that GLA.

Allocation Method

Select the Variable allocation method, because you are using a variable set of statistical values (headcount).

Statistical Basis Configuration

You have stored the following values in a statistical basis called “Global Headcount”:

Dimension 1	Dimension 2	Headcount Value
UK	Back Office	8
UK	Sales	10
UK	Marketing	2
UK	Consulting	22
US	Sales	6
US	Consulting	16
US	Back Office	3
		67

Select “Global Headcount” from the Statistical Basis picklist.
Select Dimension 1 and Dimension 2 in Distribution Fields.
Create and apply a filter where Dimension 1 contains the text "UK".

The following percentages are calculated using your selected Distribution Fields and the “Global Headcount” statistical basis:

Dimension 1	Dimension 2	Headcount Value	Percentage
UK	Back Office	8	19.06
UK	Sales	10	23.82
UK	Marketing	2	4.76
UK	Consulting	22	52.36
		42	100.00

Distribution

Select “Source” from Copy GLAs from.
"6100 - Rent " is copied from the source data and will be used for the allocation distribution.

The percentages calculated on the Statistical Basis Configuration page are used to work out the distribution of the $10,000:

General Ledger Account	Dimension 1	Dimension 2	Headcount Value	Percentage	Amount $
6100 - Rent UK	UK	Back Office	8	19.06	1,906.00
6100 - Rent UK	UK	Sales	10	23.82	2,382.00
6100 - Rent UK	UK	Marketing	2	4.76	476.00
6100 - Rent UK	UK	Consulting	22	52.36	5,236.00
			67	100.00	8,000.00

At this stage, you are ready to preview the allocation and enter the posting details. As you can see, you have now allocated the $10,000 of rent costs across the UK departments only, with the US departments filtered out.

Example 3: Allocate Marketing Costs by Set Percentage (Fixed Allocation)

In this example, you have $10,000 of marketing costs stored in the range of GLAs “6900 - Marketing” to “6999 - Online Campaigns”. These costs need to be allocated to “6900 - Marketing” across all global departments.

Dimension 1 contains your global regions (US and UK) and Dimension 2 contains your departments. In this example, you will be filtering out non-Marketing departments in Dimension 2 when retrieving the source data.

Retrieve Source

Select “6900 - Marketing” to “6999 - Online Campaigns” from the General Ledger Account field in Filter Group #1.
Select “Marketing” from the Dimension 2 field in Filter Group #1.
$10,000 is retrieved from the Marketing departments in Dimension 2 on the specified GLAs.

Allocation Method

Select the Fixed allocation method, because you will be using set percentages for your allocation.

Fixed Distribution

Enter the percentages that will be used to calculate the distribution of the $10,000:

General Ledger Account	Dimension 1	Dimension 2	Percentage
6900 - Marketing	UK	Back Office	5
6900 - Marketing	UK	Sales	20
6900 - Marketing	UK	Marketing	10
6900 - Marketing	UK	Consulting	20
6900 - Marketing	UK	Sales	20
6900 - Marketing	UK	Consulting	20
6900 - Marketing	UK	Back Office	5
			100

At this stage, you are ready to preview the allocation and enter the posting details.

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