The reference number feature enhances the size and flexibility of the Costpoint account/organization structure. You can use reference numbers for two distinct purposes:
You can use them in data entry as an extension of the accounts and organizations that are the keystones of Costpoint's financial architecture.
You can use them to provide flexibility in the presentation of general ledger reports and financial statements. You can define alternate reporting structures as reference numbers and link them to existing account/organization combinations to provide alternate cost groupings.
The use of reference numbers in either way is optional.
Costpoint provides two reference number fields are available: Reference Number 1 (also called Ref No 1 or Ref 1), and Reference Number 2 (also called Ref No 2 or Ref 2). You can use either reference number for alternate reporting or for data entry. Although it is technically possible for either reference number to serve as both an alternate reporting structure and a data entry field concurrently, this would cause confusion because reports displaying different information would contain the same heading information. For this reason, Deltek strongly recommends that you do not use one of the reference number both to store an alternate reporting structure and for data entry.
The reference number fields are 20 characters in length. Each reference number has delimiters (periods) between the user-defined levels. The delimiters are included in the field size. For example, a reference number with the structure of "XX.XXX.X" uses eight of the available 20 positions—six characters for the actual numbers at the three different levels, and two periods as the delimiters between the levels.
Reference number fields are available ondata entry screens throughout Costpoint. You can also set up budgets by reference number and account.
One use of reference numbers is to establish an alternate hierarchical reporting structure. (Using reference numbers as an alternative reporting structure is not the same as using an alternate organizational structure. See "Alternate Organizations" later in this topic for more information.)
In Costpoint, you accumulate and track costs using accounts, organizations, projects, and, optionally, reference numbers. When you define the hierarchical structure of your organizations, consider the company levels and the detail that you want financial statements to reflect. Often, however, companies want their financial reports to be able to reflect multiple scenarios or multiple structures. In some cases, you can build the structures into the levels of your organizations. You can then generate the financial reports that summarize data at different organizational levels.
However, in other situations, building alternate reporting structures into the levels of your organizations may not be advantageous or even possible. In that case, you can use reference numbers to establish an alternate reporting structure. You can then generate financial statements and other financial reports by alternate reporting structure and summarize information at various levels in that structure.
To use this feature, you define a structure for one of the reference numbers and link account/organization combinations to that alternate structure. Alternate structures can have multiple levels within the 20-character limit of the reference field. You can link account/organization combinations to multiple alternate structures if that is necessary to meet your reporting requirements. When you generate financial reports for the alternate reporting structure, balances from account/organizations that you linked to the selected alternate structure are included in those reports.
It is important to keep alternate reporting in mind as you set up your organizations. If you know of groups, regions, cost centers, and so on, that may require alternate reporting, those elements must exist in your organization structure. You cannot use alternate structures to report costs at lower levels than you track through your account/organization setup. For example, suppose you have a three-level organizational structure, with level one the overall company level. You use level two to differentiate business segments and level three to track costs by region. Each region covers multiple states or provinces. If you want to generate financial reports by state or province using an alternative reporting structure, you cannot do it because there is no level in the organization structure to identify costs at that level. In this situation, you need to use reference numbers for data entry to track costs by state or province.
However, you can use alternate reporting to roll up or summarize costs at a higher level. You use organizations to track costs at three levels: business segment, region, and office. If a director manages more than one office, you can set up an alternate reporting structure to group offices by director and print financial reports for each director. In this case, you can also group the offices by a different alternate reporting structure to print reports by state/province, as desired in the previous example. Reporting by state/province is possible because each office is located in only one state/province.
Another use of reference numbers is to track information for entities that are not incorporated into the organization or account structure. One common instance is when you need to categorize costs in a way not supported by your account structure or organization structure. For example, suppose you have a three-level organization structure. Level one is the overall company level, level two is the business segment level, and level three is the region level. However, you also want to track and report on costs by product line. You cannot use an alternate reporting structure to obtain this information because it is not captured within the existing account and organization structures. The solution is to use one of the reference number fields for data entry. You define reference numbers for each product line. Then, when you enter transactions, you enter the appropriate reference number as well as account and organization.
You do not have to link reference numbers to accounts or account/organization combinations explicitly for data entry, as when you use reference numbers as alternate reporting structures. You can use any valid reference number with any valid, active account/organization combination during data entry. However, you must initialize default reference number tables in all modules for journals that update the Reference Summary table to ensure that posting programs update the correct reference number.
When you use reference numbers for data entry, posting programs store amounts in the Reference Summary table by account and reference number. The data in the G/L Detail table and Transaction History table for each module also include the reference number for each transaction. It is imperative that you initialize the reference numbers throughout Costpoint before data entry, so that these tables contain accurate balances. You can also initialize beginning balances in the Reference Summary table.
Note that the Reference Summary table is similar to the Financial Statement Summary table. Both contain beginning balances and amounts and hours by fiscal year and period. The Financial Statement table stores this information by account and organization, while the Reference Summary table stores balances by account and reference number. The organization is not stored in the Reference Summary table.
A possible alternative to using reference numbers to establish an alternate reporting structure is to use reorganizations. There are advantages and disadvantages to each approach.
You can use reference numbers to link the elements of your alternate reporting structure to specific account/organization combinations, which provides a great deal of reporting flexibility. Also, more general ledger reports are available by reference number alternate reporting structures than by reorganization. However, you must update the reference structures whenever you add an account or organization so that all account/organization combinations are mapped properly. In addition, because of the potentially large number of account/organization combinations, setting up all of the reference/account/organization links can be very complex.
Reorganizations are linked only to organizations, rather than to account/organization combinations, making them simpler to set up and use. You only need to update reorganizations when you add or change organizations. However, your organization structure must capture all discrete reporting units. Reorganizations enable you to roll your existing organization elements up in a different fashion, but they do not provide a mechanism for redesigning your account/organization matrix. Also, Costpoint offers fewer reports that you can generate by reorganization than it does reports that you can generate by reference number alternate reporting structure.
Neither method involves alternate storage of summary data. Both are simply reporting tools that provide alternate ways to present the existing data in the Financial Statement tables.
As you evaluate your reporting needs, keep in mind that not all reports support both methods, and some reports do not support either one. Make sure you thoroughly analyze both options before deciding to use either. Ultimately, no alternate reporting method can completely take the place of a well-designed and implemented organization structure.
The following are step-by-step guides for initializing reference numbers.
To set up an alternative reporting structure using reference numbers, complete the following steps:
Use the Configure General Ledger Settings screen to define the length of the first segment of the reference number. The length of the first segment must be the same for all reference numbers. After you enter a reference number, you cannot change this length.
Define the reference structure on the Manage Reference Structures screen. Keep in mind the levels at which you need to track and report on information. Do you need to display data at multiple levels for detail and roll up reports, or can your structure be relatively flat? Enter the top-level reference number and name. That number must match the length specified on the Configure General Ledger Settings screen. Also specify the number of levels and the segment length of lower-level reference numbers. Do not select the Use in Data Entry check box on the Manage Reference Structures screen.
Use the Manage Reference Elements screen to set up each individual reference number. Use the Link to Acct/Orgs subtask of that screen to link each reference number to the appropriate account/organization combinations. This linking process updates the ORG_ACCT_REF_STRUC table. When you generate a report by alternate reporting structure, Costpoint uses the information stored in that table to determine the account/organization combinations that are linked to elements of the alternate reporting structure so it can retrieve the correct data from the Financial Statement Summary table. Note that you can also use the Mass Link References/Accounts/Organizations screen and the Link References/Accounts/Organizations screen to link account/organization combinations to reference numbers.
To set up an reference numbers for data entry, complete the following steps:
If you elect to use a reference number for data entry, the first and most important part of the initialization process is to determine your reporting needs. You gain an advantage by using reference numbers for data entry because of the additional information provided by the Reference Summary, G/L Detail, and Transaction History tables. Which information will you use to update these tables? How will you use this information? Think of the final product (a report), the information you need to see on that report, the journals that contain this information, and the method by which these costs are captured. These processes, and the manner in which they update the Reference Summary table, should become the primary focus of your initialization strategy. The exact data contained in the Reference Summary table is critical, because this table will become the primary reporting repository for your financial reports.
For example, you may need to see only revenue and cost information by reference number. Or maybe you need only to see sales numbers by product. Perhaps you plan to provide full financial reporting by reference number and therefore need all journals to post by reference number. You need to determine the information you need to store in the Reference Summary table before planning your initialization, so that only that data updates the table. In the first example in this paragraph, only revenue and expense data needs to be stored by reference number. Therefore, you do not need to initialize accrued sales or payroll tax liabilities with default reference numbers, because this data is not used. In the second example in this paragraph, only sales information is required. Therefore, you do not need to initialize default A/P, Payroll, or Cash Receipt Account/Reference Numbers, because you do not need this data posted to the Reference Summary. You can, of course, update the Reference Summary table with all postings from all modules. However, the initialization process then becomes far more time-consuming, and the table becomes much larger.
Use the Configure General Ledger Settings screen to define the length of the first segment of the reference number. The length of the first segment must be the same for all reference numbers. After you enter a reference number, you cannot change this length. Also, enter the headings to be used for the reference number fields in data entry screens.
Define the reference structure on the Manage Reference Structures screen. Keep in mind the levels at which you need to track and report on information. Do you need to display data at multiple levels for detail and roll up reports, or can your structure be relatively flat? Enter the top-level reference number and name. That number must match the length specified on the Configure General Ledger Settings screen. Also specify the number of levels and the segment length of lower-level reference numbers. Be sure to select the Use in Data Entry check box on the Manage Reference Structures screen.
Use the Manage Reference Elements screen to enter each individual reference number. Do not link the reference numbers to account/organization combinations.
If you have beginning balances available for reference numbers, initialize those balances on the Manage Reference Beginning Balances screen. Initialize only the beginning balances as of the beginning of the fiscal year. If you are initializing later in the fiscal year, use journal entries to enter reference number beginning balances.
Initialize default accounts in settings and maintenance screens. For example, if you plan to use reference numbers to track accounts receivable discounts and finance charges associated with different types of customers, you must initialize the Default Accts subtask of the Manage Customers screen. The programs that accrue finance charges and post customer billings use that information to post these amounts.
Depending on how you use reference numbers, you may not need to initialize all settings and maintenance screens. In an earlier example, Reference Number 1 was used for tracking sales by product line. In this case, you are interested only in revenue amounts. Therefore, the only data that you need to post to the Reference Summary table is sales information associated with a particular product. As a result, you must initialize the default sales account in the Customer table with reference number data, because that data is used for posting of product sales. However, you are not interested in seeing balance sheet information, such as payroll or sales tax accruals for this product line. Therefore, you do not need to initialize tables used to post payroll and sales tax.
The following is a list of maintenance screens and settings that you may need to initialize if you want to use reference numbers for data entry: