Title: Funding Caps and Fee Cap Adjustments
Unanet can limit billing and/or revenue recognition on incrementally funded projects at either the Project or Task level. When cumulative calculated revenue exceeds the Funded Value (less any fixed fee, if applicable), Unanet will post a billing and/or revenue reduction, called a Funding Cap Adjustment. Similarly, when cumulative calculated Fee revenue on a Cost Plus contract exceeds the Fixed Fee amount, Unanet will post a reduction of billing and/or revenue, called a Fixed Fee Cap Adjustment.
The revenue reduction accounts are specified in the Project's associated Posting Group. The Funded Value is set on the Accounting tabs within the Project/ Task. The Fixed Fee Amount is set on the Project's accounting Tab (there is no Fixed Fee field on the Task).
What’s covered in this document:
Project or Task Level Setup
You can optionally limit Revenue and/or Billing amounts to project and/or task Funded Values.
In this example, there is a $5,000 Funded Value on labor and $500 Funded Value on expense. The JSR shows both labor and expense have exceeded their caps.
You may also wish to present the lost revenue from Funded Value Caps and Fixed Fee Cap adjustments on separate lines in the JSR.
Billing and Revenue Post
During a Billing and Revenue Post, Unanet will calculate and post the Gross Revenue amount. If the funding cap has been exceeded and the checkbox to limit Billing and/or Revenue to funded amount has been checked, an entry will be generated to reduce Revenue by the excess amount.
The Funding Cap Adjustments can be displayed on the invoice or hidden, depending upon the invoice format that is being used.
Below is an example of how Funding Cap Adjustments may look on an invoice.
Fixed Fee Caps
Fixed Fee Amounts (or Caps) are set only at the project level (with no option to define a task-level fee cap). When the Fixed Fee Amount is populated, Unanet will automatically limit Fee Revenue and/or Billings to the set amount.
If the Limit Billing and/or Limit Revenue boxes are ALSO selected, then the Funded Value caps described above will subtract the Fixed Fee Amount from the calculation of the Funded Value Cap.
In other words, the Funded Value includes any Fixed Fee. In the example below: Total Funded Value is $1,500,000 = $1,350,000 (for labor/expense/indirect costs) + $150,000 (for fee).
In this example, Unanet would perform two separate calculations: one for the fee portion and one for the non-fee portion.