distribution of common expenses
I have following scenario.-
My client is operating a multistorey mall. There are around 200 tenants in the mall. The common expenses is factored in the rental and if it exceeds than the projected it is recovered at the year end. Now to calculate the exact amount applicable to each tenant I need to divide these expenses, which I dont want to bifurcate at the Gl entry level as it will create many line items may be in thousands per month may be based on cost center wise or re object wise.
How this can be done on monthly basis. I have one option to do it bases on creating cost center for each tenant and running distribution at each month end. Any other option is available to distribute the common expenses on rental through RE and get the report at the end of the year.
Jagannath Jadhav replied
There are couple of ways to do this and I am sure others may suggest many more. If I understand you correctly you want to bill the tenants for their share of the expenses with the settlement to respective Rentals for reporting purpose. About the division of the exp, it depends on do you want to do it based on usage or similar measurement of any kind?
1. You can set up service charge settlement and make all the rentals participate in the settlement. Create an Invoice for the total expense and settle through the settlement Participating Group. Which will distribute the cost to each rental. Month end or whenever you execute the settlement run this can be done.
2. You can also think of Sales based condition and assign a default on every rental participating in this type of expense. You can set up a nominal charge and post during sales based settlement run. If the actual is more than the projected you can always re run the difference. Also, you have sales based reporting tools to update at contract level the actual. Once these have posted, same concept CO settlement and from GL to respective Rentals and you are good for reporting.
Settlement from Contract or Order etc will not be a bigi as you can do settlement for the Rentals, per cost element configure and assign the settlement rules and execute settlement at month end.