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Accounting for CADD Center Costs

by Francis J. Connell, (F.ASCE), Pres.; McFarland-Johnson Engineers, Inc., Binghamton, NY,


Serial Information: Civil Engineering—ASCE, 1985, Vol. 55, Issue 10, Pg. 70-71


Document Type: Feature article

Abstract:

The purpose of developing a CADD cost center is to segregate all costs related to the CADD operation so that you may receive fair compensation for CADD usage and to ensure fair charges to the client. Another basic reason is to keep percent overhead from exceeding artificial limitations imposed by various clients. When setting up a cost center, establish and maintain an adequate auditable accounting system to develop schedule rates. The accounting system should allow separate accounting of all identifiable CADD costs, provide for allocable costs as they relate to CADD and/or as they properly benefit CADD operations and one that will allow for pooling of costs to develop consistent rates for the various items on the rate schedule. The same system of allocating costs must be applied to all projects and the costs allocated to the cost center must be based on the general cost principles contained in the federal acquisition regulations and the particular clients' cost reimbursement policies.

Subject Headings: Computer aided design | Benefit cost ratios | Construction costs | Client relationships | Project management | Laws and regulations | Financial management

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