Setting up categories correctly is as important to your general ledger (GL) structure as are the account numbers.
The job categories you establish in your SedonaOffice GL must be closely aligned with job types to enable you to track revenue streams and profits by product line or activity and breakdown results by new and existing business. The right setup allows you access to the reports and data you need to monitor installation activities.
How can you align categories with job types?
Job types include details for processing and managing jobs and posting GL transactions. The first step in establishing your job types is to define your job GL categories. Your job categories should be those needed to create the various profit center income statements you will use to evaluate job results at the GL level. You can evaluate detailed results by job type, system type, market type, salesperson, technician, and more with non-GL reports.
In general, Astute recommends setting up a job category for each activity or product line having a distinct profit margin expectation. Here are some common job categories:
At minimum, there should be a job category for New Business and another for Existing Business. The distinction between new and existing business is important in the calculation of RMR creation costs and, in general, knowing where your business is coming from.
You must set up at least one job type for each job category you decide to use. You must set up additional job types to accommodate different job tasks, commission plans, invoice items, or other details within the job type setup.
Astute recommends naming job types in four parts: CATEGORY, REASON, SYSTEM, and DETAIL. Part one specifies the GL category. Part two specifies the RMR reason. Part three specifies the system type. Part four is optional to specify additional detail. This naming convention provides a useful description and key details for creating reports.
For example, the job type NM-Install-CCTV-IP indicates the "Margin Installations" job category will be used in all GL entries, an RMR reason of "Installation" should be used when the recurring revenue is activated, a CCTV system is being installed, and the system is an IP type CCTV system. The distinction that the system is IP rather than Analog may be important because of differing job tasks or applicable sales commission types or simply because this additional information is useful in scheduling or other processes.
Here are some example job types displayed in a matrix of job categories and RMR reason types. The "J-" preceding the name of each job category helps differentiate job categories from service and expense categories.
Setting up job categories and types requires thoughtful analysis of your operations and reporting needs. Use job categories to report at the GL level, i.e., profit center statements. Use job types to manage job details and report job results in more detail than you can get from the GL.
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