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How Can i allocate the over head on the projects (i.e : Visa Expenses, labor accommodation, Accom. Maintenance, fuel, .etc )?

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Question added by alaa ali , Senior Accountant , Al Mutamyez Fire Equipments
Date Posted: 2016/07/02
Mohamed Ghazi CMA
by Mohamed Ghazi CMA , Finance and Budget Manager , Ernst & Young

First of all you have to differentiate between costs and the general expenses the overhead costs because some of categories you mention is a general expenses not costs and there is a difference between costs and expenses 

then identify the method you will follow Traditional or Activity base, In the traditional method you should identify the allocation base (EX: Direct labour hour )  and the predetermined rate for this allocation base which is the Budgeted amount/ budgeted allocation base 

And If ABC you have to identify the cost object and cost driver for each item, the ABC is more accurate but Hard,

 

VINAY KUMAR GOSWAMI
by VINAY KUMAR GOSWAMI , Partner , 2MI

You can allocate it as "Resource Procuement" cost and spread it across the various types of costs.

Alternatively, you can also add as "Material/ Infrastructure maintenance" activity (MS Project) or Deliverable (In Primavera or SAP) with time duations.

However, please check with your financial deparment on the financial accounting and financial code generation process.

Estimates of cost over heads of employing people are evolved over time. It is better to estimates these costs initially at higher value and improve these over time with experience and accounting the costs

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