Works Orders and Project Accounting

Prerequisites

• The Sage 200 Project Accounting module must be enabled and licensed. If it is not, the project fields on the works order are unavailable.
• The project you want to link to must have a project item (cost item) configured to allow Stock Allocations. Only these items can be selected on a works order.

Linking a works order to a project

On the New Works Order or Amend Works Order screen, two fields control the link:

1. Project Code – select the project.
2. Project item – select the cost item within the project’s structure that the manufacturing cost should be recorded against. Only items that accept stock allocations are offered.

Points to note:

• A works order can be linked to a project or to sales orders – not both. If a project is set, the Link Works Order screen will not allow the works order to be linked to an order, and a works order that already has active order links cannot have a project set.
• Once the works order has been saved and a project entry exists, the project fields are locked and the link cannot be changed.
• Copying a works order carries the project link across to the new works order.

Stage 1 - Saving the works order: the committed cost

When a works order with a project selected is saved, Cim200 creates a committed cost entry (a stock allocation type entry) against the chosen project item:

• Quantity: the outstanding works order quantity (quantity required less any quantity cancelled).
• Cost and charge rate: the works order’s estimated unit cost.
• Nominal analysis: defaulted from the project item’s default expense nominal account.
• Reference: the works order number.

This means the project shows the expected cost of manufacture from the moment the works order is raised, before any actual costs are incurred.

Stage 2 - While the works order is in progress

As stock is allocated and issued, operation times and costs are entered, and timesheets are posted, the works order’s calculated cost moves away from the original estimate.

If the Works Order setting Automatically cost works orders linked to projects on saving changes is enabled, Cim200 automatically re-costs a project-linked works order after these transactions are saved and refreshes the committed entry on the project, so the project always reflects the most recent calculated cost of the works order.

If the setting is disabled, the project continues to hold the value from the last time the works order was costed.

Stage 3 - Completing the works order

The Complete Works Orders screen includes an Allocate to Project option against each completion (the column only appears when project-linked works orders are in use, and can only be ticked for a works order that is linked to a project).

Its default value comes from the Works Order setting Allocate project on completion (default).

When a completion is booked with Allocate to Project ticked:

• The completed quantity is allocated to the project as a project stock allocation. This earmarks the finished goods for the project but does not yet consume them from stock.
• A project entry is recorded for the completed quantity at the works order’s most recent calculated unit cost.
• The original committed entry is reduced so that it only covers the quantity still outstanding on the works order.

Stage 4 - Issuing the allocated stock to the project

The project stock allocation created at completion is issued from Stock Control > Allocations > Issue Allocation (the standard Sage 200 screen). Cim200 recognises allocations that were created by a works order completion and processes the issue itself, for both traceable and non-traceable items:

• Stock is moved out to the project, with a goods-out entry written to the item’s transaction history referencing the project and cost item.
• Where the Stock Control module is set to integrate with the Nominal Ledger, a nominal journal is posted — debiting the project’s expense nominal and crediting the stock nominal.
• The project allocation is converted into a project stock issue entry for the issued quantity.

The issue is valued at the works order’s actual unit cost where the works order has been closed. If the works order is still open, the most recent estimated cost is used, and the system correctly tracks that stock has been consumed against goods that are not yet confirmed. This means allocations can be issued to the project before the works order is closed.

Stage 5 - Closing the works order

Closure is where the works order’s final actual cost is established, and the project entries are trued up to it:

• Project entries recorded against the works order and its completions are updated to the actual unit cost.
• For a one-off works order, the project entry is converted to an actual entry and retained — it becomes the project’s cost record for the manufacture.
• For a works order for a stocked item, the committed entry is removed at closure, because the actual stock transactions (the completions and their issues to the project) now carry the cost. This prevents the cost appearing twice on the project.

Cancelling a project-linked works order

When a works order linked to a project is cancelled, the Cancel Works Order screen shows a Post current costs to project option:

• Ticked: the costs incurred on the works order up to the point of cancellation are posted to the project, and the project entry is marked as an actual cost.
• Unticked: the project entry is deleted, and the project shows no cost for the cancelled works order.

Settings reference

Both settings are found in Works Order Settings and require Project Accounting to be licensed:

Automatically cost works orders linked to projects on saving changes
Re-costs a project-linked works order after amendments, stock allocation/issue, operation times and costs, and timesheets are saved, and refreshes the value held on the project.

Allocate project on completion (default)
Sets the default state of the Allocate to Project option on the Complete Works Orders screen.

Frequently asked questions

Why can’t I change the project on my works order?

Once the works order has been saved with a project and the committed entry exists, the link is fixed. The fields are also unavailable in view mode, when Project Accounting is not enabled, or when the works order is linked to a sales order.

Why is the Allocate to Project column missing from the Complete Works Orders screen?

The column only appears when there are project-linked works orders in use. It can only be ticked for works orders that are linked to a project.

Where can I see that a works order is being made for a project?

The works order’s project and cost item are shown on the works order itself, and the Needed By enquiry shows the project code as the source of demand for a project-linked works order.

Does the project link affect MRP or sales order fulfilment?

A project-linked works order cannot also be linked to sales orders, so its supply is not tied to specific sales demand. The committed cost and allocations affect the project only; normal stock and works order processing are unchanged.