In the Profitability section under Configuration, we have the option to activate the automatic proration of Salaries.
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It is necessary to be C-Level or Account Manager to access this section and activate this functionality.
This function automatically calculates the cost of the users' hours, based on their computed hours, regardless of the monthly hours assigned to them.
For example, if a user is assigned 160 hours per month and has a salary of $10,000, his hourly cost is $62.50. It may happen that users work only 100 of those hours in COR tasks and therefore, that hourly cost that impacts the client's profitability is actually $100. It may also happen that people are working longer and when computing 180 hours, their hourly cost would be reduced to $55.55.
In this way, if we add up the cost of all the computed hours of a user for a month, they will always coincide with their monthly salary.
To activate it, we have to switch the button, and then click on “Accept” in the following notification:
By default, the prorating of the salaries will be executed for the history of the computed hours, i.e. since the account is active in COR. If we want the prorated calculation to be performed only from one month onwards, we must select it in the drop-down menu:
Finally, click on “OK” to save the changes.
As soon as the functionality is activated, all the computed hours of all active users will be recalculated. If we had selected from one month onwards for the proration, only the hours worked from that month to today's date will be recalculated.
This update may take a few minutes, depending on the number of hours computed in the account.
When the functionality is already active, as soon as a user computes time, the cost is recalculated.
It is important to bear in mind that the prorating of the current month is done proportionally based on the day of the month in which we are.
In other words, if we are in the middle of the month, only half of the salary will be taken into account for the proration.
If the salary is $10,000 and we are on the 15th day of the month (50% of the current month), the proration will be made for over $5,000. If we are on the 20th day of the month (66% of the current month), the proration will be over $6,666.) If 30 hours are computed for the first 15 days, the hourly cost will be $166.67. But those same 30 hours on the 20th day of the month will have a value of $222.22 each.
If the user is still computing hours on the current day, the hourly cost may not be fully updated, but at the end of the day this value will be automatically adjusted. This is because when computing hours with the play button, the loaded time and its cost cannot be calculated until stop is selected.
Finally, if a user computes hours in a month prior to the current month, it will automatically update all values for that month.
Some considerations:
It is essential that users compute all their working hours in COR so that this functionality indicates the real hourly cost.
It is very important to keep the salaries updated every month so that the hourly cost is correct.
If the user computes hours in a month prior to the activation of the salary proration (or otherwise prior to the selection of “Activation from”), the costs will not be recalculated.