You can use rates to calculate the amount of planned cost or revenue for each planning resource during workplan and financial planning. A planning resource is a specific resource that you can use in the context of workplan and financial planning.
You enter a quantity for each rate-based planning resource that you assign to a workplan or to a financial budget or forecast. Oracle Projects spreads the entered quantity over the periods for which you are planning based on the associated dates and spread curve. Oracle Projects considers a planning resource to be rate-based if it has a unit of measure other than Currency. If you do not enable the workplan to allow actual effort and cost collection, then Oracle Projects considers all planning resources to be non-rate-based.
Next, Oracle Projects determines a rate for each period and multiplies the rate by the quantity for the period. It adds all period amounts together to provide a total amount. Finally, it divides the total amount by the entered quantity to calculate the displayed rate. The displayed rate is also known as the average rate.
Note: You can enter an amount for a rate-based resource rather than the quantity. However, the resource remains rate-based for future entries.
You can choose to use either actual rates or planning rates to determine rates for workplan and financial planning.
Actual rates are the rates that Oracle Projects uses to calculate the actual costs and revenue for expenditure items. Oracle Projects determines rates for planning resources using the same logic as used to calculate actual costs and revenue when you use actual rates for workplan and financial planning.
Planning rates are the rates Oracle Projects uses to determine the rates for planning resources when you enable the planning rates option for a workplan structure or for the planning options for a financial structure, budget version, or forecast version. You can assign a set of rate schedules to use specifically for planning purposes if you enable planning rates.
You may choose to use planning rates, rather than actual rates, for various reasons. For example:
You want to plan far into the future when actual rates are not yet known. Planning rates enable you to plan for cost and revenue for future periods by making assumptions about potential rate increases or decreases.
You want to plan at a more summary level than when using actual rates. For example, you can use job-based rate schedules to plan, but actually track labor costs using cost rates defined at the employee level.
The table below summarizes the precedence order for determining rates using either the actual rates or the planning rates approach.
| Rate Source | Precedence: Actual Rates | Precedence: Planning Rates |
|---|---|---|
| Rate Override | 1 | 1 |
| Actuals Rate Logic | 2 | Not Applicable |
| Planning Rate Schedules | Not Applicable | 2 |
| Resource Class Rate Schedule | 3 | 3 |
| Budget Calculation Extensions | 4 | 4 |
You can determine a cost rate, a burden rate, and a bill rate for a planning resource. Oracle Projects determines cost and bill rates only for rate-based planning resources, and burden rates for all planning resources. For planning resources assigned to contract projects, it determines bill rates for projects with a revenue accrual method of either Work or Cost, but not for projects with a revenue accrual method of Event.
Oracle Projects can use the expenditure type to find a rate if a planning resource is associated with a rate-based expenditure type. Otherwise, it skips the expenditure type for rate processing. Oracle Projects does not use an expenditure type to determine a cost rate for planning resources that have a resource type of People.
Oracle Projects can use information from Oracle Inventory to find a cost rate for planning resources that have a resource type of Inventory.
Oracle Projects can use information from Oracle Bill of Materials (BOM) to attempt to find a cost rate for planning resources that have a resource type of BOM Labor or BOM Equipment. Otherwise, it uses the expenditure type associated the planning resource to determine the rate.
Oracle Projects determines rates whenever you assign a planning resource to a task and redetermines the rates whenever you change an attribute for the task assignment, including changes to the planning resource, transaction dates, or manufacturing cost type. In addition, you can manually choose to refresh the rates for a workplan or for a budget or forecast version.
If you use the actual rates approach for determining rates for planning, Oracle Projects follows the same logic that it uses to calculate costs and revenue for actual expenditures.
When you assign a planning resource to a task, if the task or the project is associated with a rate override, then Oracle Projects uses the override value. Because you always charge actual expenditures to a lowest level task, and you can assign planning resources to any work breakdown structure level, Oracle Projects uses whatever options are available at that work breakdown structure level.
Note: Oracle Projects only uses task overrides when the project has shared workplan and financial structures.
The logic for determining rates for actual expenditures assumes that all attributes for an actual expenditure are present. When Oracle Projects attempts to determine a rate for a planning resource, it does not always have all attributes that would exist for an actual expenditure because you can plan at an aggregate level.
Oracle Projects uses the Resource Class Raw Cost rate schedule that you specify for the workplan structure or for the budget or forecast version if it is unable to determine a cost rate. It uses the Resource Class Bill Rate rate schedule that you specify for the budget or forecast version if it is unable to determine a bill rate for a planning resource for a financial budget or forecast.
Oracle Projects also calls the Budget Calculation client extensions, passing any values determined during prior steps to the extensions. You can program the client extensions to modify these values.
If you use the planning rates approach for determining rates for planning, Oracle Projects first determines if the planning resource assigned to a task is associated with a rate override. If it is, then Oracle Projects uses the override value. Next, it attempts to determine planning rates using the planning schedules that you specify for a workplan structure or for a financial budget or forecast version.
Oracle Projects determines cost rates using the employee, job, and non-labor planning rate schedules. An employee rate schedule has precedence over a job rate schedule for planning resources with a resource type of Labor. If Oracle Projects cannot find a cost rate using the job, employee, or non-labor rate schedules, then it uses the resource class planning rate schedule that you specify for costs.
Oracle Projects determines planning resource bill rates for financial budgets or forecasts using the employee, job, and non-labor planning revenue rate schedules that you specify in the planning options. An employee bill rate has precedence over a job bill rate for labor bill rates. Oracle Projects uses bill rates defined for the non-labor planning rate schedule for non-labor bill rates. Oracle Projects uses the resource class planning rate schedule for revenue if it cannot find a bill rate using the job, employee, or non-labor rate schedules.
In addition to rate schedules, you also specify a burden schedule when you define planning rate schedules. Oracle Projects uses this burden schedule to calculate the burdened cost for planning resources. If an expenditure type is not associated with the planning resource, then Oracle Projects uses the expenditure type defined at the resource class level to determine the burden rate. If an organization is present for the planning resource, Oracle Projects attempts to find a rate using the planning rates burden schedule. If an organization is not associated with the planning resource, or if the burden schedule does not return a rate, then Oracle Projects sets the burdened cost to be equal the raw cost.
Oracle Projects also calls the Budget Calculation client extensions, passing any values determined during prior steps to the extensions. You can program the client extensions to modify these values.
Other Sources
Budget Calculation Extensions, Oracle Projects APIs, Client Extensions, and Open Interfaces Reference
Planning Resources and Resource Lists, Oracle Projects Implementation Guide