Global lists: Departments [in-depth guide]
Guide contents: System setup | Using departments | Reporting/tracking
Departments are used to group your information into different functional areas. Departments can be used on several reports for filtering & grouping data. Departments are global across a company and will be the same from office to office.
Departments are tracked at the transaction Level.
For financial reporting of Departmental profit & loss statements, the department must be set on the individual role/services, expense items, purchase items, and media items.
Menu > Admin > System setup > Global lists > Departments
Add a department to system
- To add a new department, click the button.
- In the Department name text box, enter a descriptive name for the department.
- Click the [Save] button.
Menu > Admin > System setup > GL settings > GL tracking options > check Show departments
NOTE: If you want to require that a department is selected, check 'require departments'. During setup, you should leave this unchecked.
Once you have created the departments and selected 'show departments' you will need to set up the department in the following areas:
Employee: Menu > Admin > Employees: open employee record > Accounting: Department- Select the appropriate department for the employee > OK > SAVE
Billing items: Menu > Admin > System setup > Time & billing: Billing items: select Billing item > enter Department > SAVE
Services: Menu > Admin > System setup > Time & billing > Services: select the Service > enter Department > SAVE
Expense Reports: Menu > Admin > System setup > Purchasing > Expense report items > select the Expense report item > enter Department > SAVE
Purchasing: Menu > Admin > System setup > Purchasing > Purchase items > select the Purchase item > enter Department > SAVE
Media: Menu > Admin > System setup > Media > Print items/broadcast items > select the Item > enter Department > SAVE
Because departments are tracked at the transaction level, a department can be tracked across projects. This allows multiple departments to work on a single project and have the transactions identified as belonging/tracked to the individual departments.
From the setup, you understand that departments are tied to:
- Employee record
- Services (labor)
- Billing items
- Items (expenses), which include:
- Expense report items
- Purchase items
- Media items (print & broadcast)
The following are some of the things that need to be considered during setup and whether you need to use departments or not:
Are the same services performed in different departments, i.e, copywriter in both departments, or is the service only performed by one department, i.e. graphic designer in your creative dept and only HTML programmer in your interactive dept?
- If the services are unique to each department., then you do not need to set up departments. The service will provide the reporting/tracking you need.
- If the same service is duplicated in different departments, then you will need to create a service for each department, i.e. copy-creative and copy-interactive, etc.
Item (expense): Expense report items, purchase items, media items
Do you need to identify which department an expense came from on each project? i.e., photography is photography, regardless of which department purchased the photography.
- If the expense is simply project-related and not department-related, then you will not need to set up departments. The items will provide the reporting/tracking you need.
- If you have to identify expenses by department, then you will need to enter an item for each department, i.e. printing-creative and printing-interactive, etc.
When you are referring to Labor (time entered by your employees), the cost/expense of this will be designated by the department set in the employee record. The revenue side will track to the department set on the services.
For Purchase items, the department will be designated on the purchased item.
For Expense report items, since an expense report is not considered a true cost until a voucher/invoice is created, the department will come from the expense report item. However, once the expense item has been added to a vendor invoice (to reimburse the employee), then the department will be designated by the employee record.
Revenue for any expenses will come from the expense item.
NOTE: You can override the above settings via Menu > Admin > System setup > Global options > Transaction preferences > Expense report setup: Generating vendor invoice use detail from item
When selected the Department will be designated by the expense report item, instead of the Employee: Accounting: Department setting.