Lesson 7.4: Running and Analyzing Allocations

In the previous lesson, you configured your Chart of Accounts with the necessary Account Designators and Exclusions. Now you are ready to build the Allocation Worksheet. This worksheet contains the specific instructions (parameters) that tell FastFund exactly how to distribute costs for a specific period. This lesson covers creating these worksheets, defining the “From” and “To” relationships, setting up complex “Step-Down” allocations, and analyzing your setup before processing.

Creating an Allocation Worksheet

The Allocation Worksheet is the control center for the indirect cost process. You can create an unlimited number of worksheets, allowing you to test different scenarios to find the most equitable distribution method.

To Create a Worksheet:

1. Navigate to Cost Allocations > Allocation Types > Indirect Cost Setup.

2. Click New + to create a new worksheet.

3. Header Info:

    ◦ Name: Enter a unique name (e.g., “Monthly Overhead Allocation”) and description.

    ◦ Period: Enter the date range for the transactions you want to allocate. This can range from a single month to a full year.

    ◦ Fund: Select the Fund where the allocation is performed. Note: Indirect Cost Allocations cannot allocate across different funds because each fund has distinct net asset classifications and inter-fund balancing requirements.

4. Save: Click Save to establish the worksheet header before adding specific parameters.

Cross-Fiscal Year Note: If you enter a date range that crosses fiscal years, FastFund will calculate the amounts and generate reports, but it will not create a Journal Entry to post the results, as this would mix closed and open fiscal periods.

Defining Allocation Parameters

Once the worksheet is saved, you must add Allocation Parameters. A parameter defines a single distribution rule (e.g., “Allocate Rent to Programs based on Square Footage”).

1. Add Parameter: Click the New + icon in the parameters grid.

2. Define the Source (“Allocate From”):

    ◦ Name: Name the parameter (e.g., “Occupancy Allocation”).

    ◦ Basis: Select the method (e.g., Fixed Numeric Value, Direct Cost, Total by Specific Account).

    ◦ Account Type: Choose whether to allocate Revenue, Expenses, or Both.

    ◦ Allocate From: Select the specific Cost Center holding the pooled costs (e.g., “Administration”).

    ◦ Note: If using “Total by Specific Account,” you must also select the Designation you created in Lesson 7.3.

3. Define the Targets (“Allocated To”):

    ◦ Click the Benefitting Cost Center link (displayed to the left of the “Allocate From” section).

    ◦ Select the first Cost Center to receive costs.

    ◦ Enter Value: Depending on your Basis, enter the data here:

        ▪ Fixed Percentage: Enter the % (must total 100%).

        ▪ Fixed Numeric Value: Enter the statistic (e.g., 1,500 square feet). FastFund will sum all values entered to determine the total pool and calculate the percentage for each center automatically.

    ◦ Repeat for all benefiting cost centers and click OK.

Setting Up Step-Down Allocations

FastFund supports Step-Down Allocations, where costs are distributed in a specific sequence. For example, you might allocate “Occupancy” costs to all departments (including Admin) first, and then allocate “Admin” (which now includes its share of occupancy) to the final programs.

The Order Matters: The system processes allocations in the exact order they are listed in the worksheet.

1. Sequence: Place shared pools (like Facilities/Occupancy) at the top of the list so they are distributed first. The first allocation performed should always be from a cost center pool that will not have any expenses allocated to it.

2. Reordering: If your parameters are in the wrong order, click and hold the Navigator Arrows icon (to the left of the parameter) and drag the line up or down to the correct position.

Analyzing the Worksheet

Before running the financial calculations, you should print the Allocation Worksheet Report to verify your logic and data entry.

• Click the Worksheet dropdown button at the top of the screen.

• Select PDF or HTML.

• Review: This report lists every parameter, the basis used, the source cost center, and the target cost centers with their assigned values (e.g., square footage figures). This ensures your setup is correct before you alter your general ledger.