Cost Accounting — Vertex ERP Manual

1. Overview

The Cost Accounting module stores and organizes product costing data: cost centers, rates, standard costs, production-order cost elements, variances, and links to Finance journals.

Area	What you maintain
Core	Cost centers, cost items, drivers, rates, allocation rules
Resources	Machine types, machines, downtime; labor types via API
Standard costing	Product standard cost versions with materials and operations
Production	Orders, stages, materials, labor, machine hours, overheads, outputs
Analysis	Cost variances and detail lines
Integration	Posting rules, cost journal links, allocation logs
Reports	Filtered list views of the same data

flowchart LR Core[Cost centers / rates] --> Std[Standard costs] Core --> Prod[Production orders] Std --> Var[Variances] Prod --> Var Prod --> Alloc[Overheads / allocation] Var --> Fin[Finance journal links] Alloc --> Fin

Important operating model: Most screens are CRUD data entry. Statuses, rollup totals, variance amounts, allocations, and Finance postings are maintained by users (or external Finance journals). There is no separate “calculate / allocate / post” button workflow in the current application services.

2. Getting started

2.1 Recommended setup order

flowchart TD A[Finance dimensions and COA] --> B[Inventory products and units] B --> C[Cost centers] C --> D[Cost items and drivers] D --> E[Cost rates] E --> F[Machines and machine types] F --> G[Allocation and posting rules] G --> H[Standard costs] H --> I[Production orders and cost elements] I --> J[Variances and journal links]

Prepare Finance dimension values (for cost centers), chart of accounts, fiscal periods, and voucher types.
Prepare Inventory product/unit/location identifiers you will reference.
Create cost centers, cost items, drivers, then rates.
Create machine types and machines.
Define allocation rules and posting rules.
Build standard costs for products.
Capture production orders and cost elements.
Record variances and link Finance journals when posting.

2.2 Main navigation

Parent menu: Cost Accounting (/cost-accounting). Default redirect: cost items.

Menu	Path	Purpose
Cost Centers	`/cost-accounting/cost-center-settings`	Cost center settings
Cost Items	`/cost-accounting/cost-items`	Cost element catalog
Cost Drivers	`/cost-accounting/cost-drivers`	Allocation/measurement drivers
Cost Rates	`/cost-accounting/cost-rates`	Rates by center and driver
Allocation Rules	`/cost-accounting/cost-allocation-rules`	How costs move between centers
Production Orders	`/cost-accounting/production-orders`	Order headers
Production Stages	`/cost-accounting/production-order-stages`	Order stages
Materials	`/cost-accounting/production-order-materials`	Material issues
Labor	`/cost-accounting/production-order-labor`	Labor charges
Machine Hours	`/cost-accounting/production-order-machine-hours`	Machine time
Overheads	`/cost-accounting/production-order-overheads`	Overhead charges
Outputs	`/cost-accounting/production-order-outputs`	Finished / by-product / scrap
Standard Costs	`/cost-accounting/standard-costs`	Standard cost headers
Standard Cost Materials	`/cost-accounting/standard-cost-materials`	BOM-like standards
Standard Cost Operations	`/cost-accounting/standard-cost-operations`	Operation standards
Variances	`/cost-accounting/cost-variances`	Variance headers
Variance Details	`/cost-accounting/cost-variance-details`	Variance lines
Cost Journals	`/cost-accounting/cost-journal-entries`	Links to Finance JEs
Posting Rules	`/cost-accounting/cost-posting-rules`	Account mapping templates
Machine Types / Machines / Downtime	`/cost-accounting/machine-*`	Resource masters
Production Order Cost report	`/cost-accounting/reports/production-order-cost`	Report list

Additional report routes exist for product cost, variance analysis, allocation, cost rates, machine/labor usage, and standard vs actual (list/filter style).

UI note: Screens use a shared CRUD page. Many foreign keys are entered as identifiers; enum fields may appear as numbers. Enter values carefully and keep a reference list of enum codes for your team.

3. Core master data

3.1 Cost centers

Link a Finance dimension value to cost-center behavior.

Field	Meaning
Dimension value	Finance analytic cost center
Cost center type	Production, Laboratory, Quality, Storage, Administrative, Service, Other
Production / service flags	Role of the center
Machine hour rate	Optional default rate
Default overhead / WIP accounts	Optional Finance accounts
Notes	Free text

3.2 Cost items

Catalog of cost elements.

Field	Meaning
Code / name	Unique code per tenant
Cost item type	Direct material, direct labor, variable/fixed overhead, administrative, selling, scrap
Cost behavior	Variable, Fixed, Mixed
Default GL account	Optional Finance account
Active / sort / description	Catalog controls

3.3 Cost drivers

Measurement bases such as hours or quantities.

Field	Meaning
Code / name	Identity
Driver type	Time, Quantity, Count, Value, Percentage
Unit of measure	Text unit
Active / sort	Catalog controls

3.4 Cost rates

Rate cards used when charging centers.

Field	Meaning
Cost center / driver	Required links
Cost item	Optional
Rate	Monetary rate
Effective from / to	Validity
Fiscal period	Optional
Active / notes	Controls

3.5 Cost allocation rules

Define how costs move from a source center toward targets.

Field	Meaning
Code / name	Identity
Source / target cost center	From → to
Target cost item / driver	Optional targeting
Allocation method	Percentage, Fixed amount, By driver, Equal
Allocation basis	Value, Quantity, Hours, Percentage
Fixed percentage / priority	Method parameters
Effective dates / active	Controls

flowchart TD A[Define cost centers] --> B[Define cost items] B --> C[Define drivers] C --> D[Publish cost rates] D --> E[Configure allocation rules]

4. Resources

4.1 Machine types and machines

Entity	Key fields
Machine type	Code, name, category, default hourly rate, active
Machine	Code, name, type, cost center, location Guids, purchase info, hourly rate, capacity, status, active

Machine status: Active, Idle, Under maintenance, Out of service.

4.2 Machine downtime

Record downtime events: machine, optional production order/center, downtime type, start/end, duration, cost impact, reason, status (Open / Closed / Cancelled).

Downtime types: Breakdown, Scheduled maintenance, Setup change, Waiting for materials, Power outage, Other.

4.3 Labor types

Labor type masters exist in the API (code, category, direct flag, default hourly rate, optional cost item/center). There is no dedicated menu screen in the current UI. Production labor lines store worker name/id and amounts directly and do not require a labor-type link.

5. Standard costing

A standard cost is a versioned product cost plan.

Header

Field	Meaning
Code / name / product / version	Unique per product version
Fiscal period / effective dates	Validity
Standard material / labor / overhead / total	Rollup amounts
Status	Draft, Approved, Cancelled, Archived
Active / notes	Controls

Materials

Standard quantity, unit cost, total, optional scrap percentage, unit, cost item, line number.

Operations

Operation name/type (Manual, Machine, Mixed), standard hours, rate, cost, optional cost center/driver, line number.

flowchart TD A[Create standard cost Draft] --> B[Add materials] B --> C[Add operations] C --> D[Enter rollup totals] D --> E[Set Status Approved and Active]

Statuses are user-maintained. Use Approved + Active for standards you intend to compare against production.

6. Production costing

6.1 Production order

Field	Meaning
Order number	Unique
Product / batch / quantities / unit	What is produced
Planned/actual dates	Schedule
Status	Planned, InProgress, Completed, Cancelled, Closed
Priority / locations / fiscal period	Context
Standard cost link	Optional comparison basis
Total material / labor / overhead / total / unit cost	Rollups

Status changes are manual (not enforced by a state machine).

6.2 Stages

Stage number/name, optional cost center, planned/actual times, status Pending / InProgress / Completed / Skipped.

6.3 Cost elements

Screen	Typical content
Materials	Planned/actual qty, unit cost, total, optional stock movement id
Labor	Worker, date, hours, rate, total, direct flag
Machine hours	Machine, date, hours, rate, total
Overheads	Cost item, driver qty, rate, amount, allocation rule, allocated flag
Outputs	Finished good / by-product / scrap, quantity, unit cost, total

flowchart TD A[Create order Planned] --> B[Add stages] B --> C[Enter materials labor machine overhead] C --> D[Update order rollup totals] D --> E[Record outputs] E --> F[Set Completed or Closed]

Practice: Keep child line totals consistent with header rollups. Overhead amount is typically driver quantity times rate when you compute it offline or in a spreadsheet.

7. Variances

Compare standard vs actual for a production order/product.

Header

Links to production order, product, optional standard cost and fiscal period; analysis date; code; standard/actual material/labor/overhead/totals; variance amounts and percentage; nature (Unfavorable / Favorable / Neutral); posted flag and optional Finance journal id.

Details

Category (Material / Labor / Overhead), type (Price, Quantity, Mix, Yield, Volume, Spending), quantity/rate variances, standard/actual/total variance, nature, line number.

flowchart TD A[Gather standard and actual totals] --> B[Create variance header] B --> C[Add detail lines by category and type] C --> D[Set nature and percentage] D --> E[Optional link Finance journal and mark posted]

Variance math is entered by the user. Typical formulas for your procedure manual:

Header variance = actual − standard for each cost class
Detail lines break price vs quantity (and other textbook types) as your policy requires

8. Allocation and Finance integration

8.1 Cost posting rules

Templates that map event types to Finance accounts.

Field	Meaning
Code / name / rule type	Material issue, labor, overhead, completion, variance, adjustment
Optional scope	Cost item, center, production order
Debit / credit / WIP / variance accounts	Chart of accounts
Voucher type / priority / active / dates	Posting policy

Rules are reference configuration. Creating a rule does not post a journal by itself.

8.2 Cost journal entries

Bridge records that point to a Finance journal entry id.

Field	Meaning
Journal entry id	Required Finance JE
Entry type	Material issue, labor, overhead, completion, variance, reversal, inventory adjustment
Date / debit / credit totals	Snapshot
Posted / posted at / by	Flags
Reversed / reversal entry	Reversal tracking
Optional production order / variance	Traceability

Procedure: Post the journal in Finance, then create the cost journal link here and set posted flags as needed.

8.3 Cost allocation logs

Audit rows for allocations: rule, date, driver quantity, rate, allocated amount, source total, percentage, status (Draft / Approved / Posted / Cancelled), posted flag, optional journal id. Visible mainly via the allocation report list.

flowchart TD A[Configure posting rules] --> B[Create Finance journal] B --> C[Create Cost Journal Entry link] C --> D[Mark IsPosted] E[Record overhead / allocation log] --> B

9. Reports

Report screens are read-only filtered lists of existing entities:

Report	Source data
Production order cost	Production orders with cost rollups
Product cost	Standard costs
Variance analysis / standard vs actual	Cost variances
Allocation	Allocation logs
Cost rates	Cost rates
Machine usage	Production machine hours
Labor usage	Production labor

Use them for review and export-style browsing rather than as separate calculation engines.

10. Permissions summary

Permission group: CostAccounting.

Resource	Abilities
Cost center settings	Create, Update, Delete
Cost items / drivers / rates	Create, Update, Delete
Cost allocation rules	Create, Update, Delete (also covers allocation log access)
Production orders	Create, Update, Delete (includes stages and all cost element children)
Standard costs	Create, Update, Delete (includes materials and operations)
Cost variances	Create, Update, Delete (includes details)
Cost journal entries	Create, Update, Delete
Cost posting rules	Create, Update, Delete
Machines / machine types / downtime	Create, Update, Delete
Labor types	Create, Update, Delete (API)
Reports	Report screen access

Parent menu opens when the user has Cost Items or Production Orders permission.

11. Relation to other modules

Module	Relationship
Finance	Cost centers reference dimension values; posting rules and cost journals reference accounts and journal entry ids. Journals are created in Finance, then linked.
Inventory	Product, unit, warehouse/store/branch, and stock movement ids are soft references for materials and outputs.
Manufacturing	Separate manufacturing domain may also track production/machines. Cost Accounting keeps its own production order and machine entities; they are not automatically synchronized.
Payroll	Labor charges store worker identity/text; not auto-fed from Payroll.

Appendix A — Quick procedures

A.1 Publish a standard cost

Create header with product and version (Draft).
Enter material and operation lines.
Fill standard material/labor/overhead/total.
Set status to Approved and active.

A.2 Cost a production order

Create order and link standard cost if used.
Add stages.
Enter materials, labor, machine hours, overheads with totals.
Update header rollups and unit cost.
Record outputs.
Set status to Completed or Closed.

A.3 Analyze and post a variance

Create variance header from standard vs actual totals.
Add detail lines by category/type.
Create Finance journal for the variance if required.
Link journal on the variance and/or cost journal entry; mark posted.

A.4 Charge overhead

Ensure rates and allocation rules exist.
Create production overhead lines (qty × rate = amount) and/or allocation logs.
Set allocated/posted flags when done.
Post Finance JE and link if GL impact is required.

Appendix B — Operating notes

Topic	Guidance
Automation	Treat the module as a costing workbook in the ERP; calculate offline if needed, then enter results
Enums in UI	Keep a shared enum value list for your team
Identifiers	Copy valid Guids from Finance/Inventory carefully
Manufacturing overlap	Do not assume Manufacturing orders auto-create CA production orders
Labor types	Maintain via API if needed; labor entry screens do not require them
Field names	Prefer API/DTO field names when integrating; some form labels are shortened

Appendix C — Document control

Item	Value
Title	Cost Accounting Module User Guide
Source of truth	`modules/costaccounting` and `frontend/src/app/modules/cost-accounting`
Format	Markdown + Mermaid (PDF edition embeds rendered figures)
Screenshots	Not included (by design)

This guide describes functional capabilities of the Cost Accounting module as implemented in the Vertex ERP codebase. UI labels may appear in English or Arabic depending on language settings.