Lawson AC: Bring your Projects out of the Shadows

Join RPI and learn Lawson AC while watching this webinar. Learn how Lawson’s Project Accounting (AC) can help your organization keep track of project expenditures and project budgets including PO and RQ commitments. Review all the cool things organizations have done with Activities.

Transcript

Keith Wayland: Our webinar today on project accounting, being projects to light. I’m very excited to have one of our very best consultants here today, Ms. Cindi Brackins, doing this webinar. It’s going to be a fantastic presentation. Before I hand it off to her, I have a couple of housekeeping notes. I’ve also promised to start the “About RPI,” so very quickly we will be recording this webinar. It takes us about a week or so to get it edited and uploaded into YouTube. Once we do, we will forward you that link that you may rewatch it or share it with your colleagues. Definitely appreciate your support on these.

Also, we encourage questions. Sometimes it’s a little bit challenging when talking to a camera. When you guys ask questions it sort of helps us break up the flow and liven it up a little bit. Mr. Bill Getty is manning the GoToMeeting module, just type in questions as you go. Real quick here, talking about RPI, we’ve been in business since 1999. We’re a full-service loss and consulting firm. We have over 70 consultants on staff at this point, and we cover the full gamut, including Financials, HR, Supply Chain, all the technologies. Here we’re highlighting some of our financial consultants that have worked to help customers employ activities. Without further ado, I give you Ms. Cindi Brackins.

Cindi Brackins: Hello, everyone. Today we’re going to cover what is Activity Management and what can it do for you. We’re going to go over AC integration and the functionality. We’ll go through how to track commitments, exactly what that means in the AC world, and the different applications of activities. We are also going to try to save the world from the shadow projects, and show you some case studies. We’ll also throw in best practice information at the end.

Many people say, “Why implement Lawson Activities?” In the absence of AC projects, they live in the shadows. You typically have projects that are being tracked, either through Excel, off-the-shelf, on paper (heaven help us), and we also sometimes see them tracked in the General Ledger. We want to help you fight the world of the shadows.

Some pain points from those shadow systems and tracking activities, is we have to pull the information out of your AP system, your PO, and your requisition system. That means there’s double entry of data, there’s manual entry typically into those shadow systems. Typically, you have a lot of keying errors, the information’s old, and it could either be missing or incomplete. Also, if you track those in the GL, it also must conform to your fiscal year calendar and your GL processing rules.

Unmasking A Lawson Superhero, “AC:” You’re going to hear me refer to it probably as Activity Management, as an application that has many, many names. It started in Lawson a long time ago, called Project Accounting, became Activity Management, then now I think it’s called Project and Activity Accounting. I’m going to always call it Activity Management, because I’m old and stuck in my ways.

Keith Wayland: You’ve earned it.

Cindi Brackins: It’s an application that’s designed to meet multiple different needs of an organization. It’s kind of a blank slate. You can use it to track many, many different things. It gives you a single data source for your project reporting, as well as it’s fully integrated with other Lawson applications.

This is an example of the AC integration with the other Lawson applications. You can see payroll talks to it, inventory control, PO, AP, all of your Lawson modules talk to it, as well as it talks to some of them as well. You can see the billing and revenue management piece of it. Those little arrows are back and forth because you accumulate cost there, and then you can bill and recognize revenue off of those.

The “Fantastic” Four A’s of Activity Management: When you use AC, you have to use all 4 A’s from the transaction block, which means I have to populate an accounting unit, account, activity, and account category. Whenever I create these on a transaction, it simultaneously populates both the GLTRANS as well as the ACTRANS.

A little comparison from the AC to GL piece of it is the basic building blocks of GL exists in AC. In AC, there’s something called an activity group, which is real similar to how a GL company would work. It defines the levels, your size, how you process your transactions. Your category structure, you might equate that to the chart of accounts. It’s very similar, in that I can create a category structure and provide organization and reporting levels for the account categories to find in the structure. I can have summary account categories with posting account categories, which is very similar to the chart.

There’s an activity, which is pretty easy to equate to an accounting unit. I can have both summary and posting. I also can have something in Activity Management called a Contract Type activity, which is used for billing and revenue recognition. The account category, think of that as being very similar to your account. This can also be similar to your accounts as well.

There are things called AC commitments, which is very similar to GL commitments. It’s most commonly used in the AC world, rather than in the GL world. The purpose of those is so I can commit the budget to obligate or encumber those funds at some point very, very early in the transaction life-cycle. We also have AC allocations, which is very similar to the cost allocations. An example of this might be where I want to assign indirect cost to a project. Thus resulting in the “Dynamic Duo of AC,” which are activities and account categories.

I’m going to talk about commitments a little bit, and how awesome they are. You can have manual commitments that you create, where a user can manually say, “I want to set aside a certain dollar amount,” and I can create a manual commitment. I also can create commitments from my requisition, as well as my PO, as well as from AP.

There’s also burden functionality, and that provides a real-time charge to a project that’s based on another posted event. Think of things such as fringe benefits, or indirect costs that you want to apply to a grant. There are also some highly usable delivered reports that are out there, that give you a good bit of detail about the activity commitments. There’s summary reports as well as detail reports.

The way a commitment processes through Lawson is you’ll add a requisition, and then when that requisition gets released, it creates a requisition commitment. Once the PO is created and released, it relieves that requisition commitment and becomes a PO commitment. Once I match and release an invoice, it relieves that PO commitment, and creates an AP commitment. Once that AP invoice distribution is closed, then it relieves the AP commitment and now becomes an AC commitment. Once the AC transaction’s posted, it becomes an AC actual. The key piece to remember from a commitment perspective is, if you’re doing budget monitoring, then you’re committing to spending those dollars in your budget so you can’t overspend.

We have here Keith from RPI sitting, thinking about how he could use Activity Management at RPI to help him track user groups. I’m going to go through a little example of some things that Keith would like to do in order to track user groups in Lawson. In this example that I have on the screen here is we have an activity created called Keystone User Group. Let’s see, oops.

I also have account categories created and you can see in this example, he’s wanting to track travel and entertainment, airfare, sponsorship, and logistics. He has a platinum sponsorship, he creates a PO for that platinum sponsorship for $3,000. He has costs for a conference room and projector. He creates a PO for $1,464.50 for that conference room and projector. Now I can look at my activity commitment report, my AC295 canned report, and I can see here that I do have $3,000 of a commitment for the sponsorship, and 1,464.50 for the logistics commitment. You can also see that I have budgeted dollars of $12,000 for the Keystone User Group.

Now I have some travel invoices flowing through, quite a few of those going to come through. Now I can see my AC295 report, and I can see I still have my commitments here from the 3,000 and the 1,464, and now I have an actual commitment of 6,524.55 for those invoices that I actually paid. Now I also have airfare reimbursements, invoices for sponsorship that’s going to come through, and now I can see … I run my activity commitment summary again, and you can see now everything’s moved from the commitment column, and now everything is over in the actual column. I can see that we spent $489.00 more than we budgeted. Very simple example of how you could track things in Activity Management. Do we have any questions so far before I move on? No?

This is a capital project. This is an example of a capital projects structure where we’ve created our activity group of capital projects. We have a professional services as our level one. We have some summary level twos, which are admin, lab, pharmacy. Then we have our specific projects at level three. You can see that budgets reside at level three, and they roll up to those upper levels. Having an activity for an unallocated budget lets you do all of your reporting in budget management in AC. Even though you may not have an actual project to allocate the budget to, if you have an unallocated budget line there, you can simply remove that whenever you do create one.

Construction Projects: we collect balances to interface into AM. There’s a program that you can run to automatically interface those into Asset Management and create those as assets. We can exclude or include relevant categories. You should consider using a vendor agreement for the main contractor. You also can exclude specific transactions if necessary. We can create one or we can create many assets from those project balances, and that interface also can amend an existing asset record. Say you had a cost that come through two months later after you created your asset, and you say, “Uh-oh. I really need to adjust that ass