On costs represent additional expenses incurred beyond a worker's base salary or wage. These expenses include taxes, insurance, benefits, and various indirect costs associated with employment. With Xemplo’s on costs module, Xemplo users have control over configurations for precise margin reports, saving valuable time that would otherwise be spent manipulating data externally.
In this article you’ll learn how to:
Creating On Costs
Within the company settings, navigate to On Costs, and then click on + New On cost.
Fill in the existing fields for the New On cost, the Save.
| Name | Name for the on cost |
| Enable in engagement by default | Enable / Disable whether this on cost should be enabled by default for new engagements |
| Category | Select a category for the on cost from the pre-defined list of categories |
| Type | Only visible if Administrator companies are being used. This allows you to choose whether this is an on cost incurred by the agency or the administrator company |
| Amount | The default amount for the on cost. This can be overridden at the engagement level and, if enabled, at the assignment level |
| Units |
Selection of whether the on cost should be computed as percent, fixed fee per timesheet or per payroll
Note - only percent and fixed fee per timesheet unit modes are compatible with Advanced on cost calculations |
| Include on cost in invoice | Only visible if the selected Type is Agency. When activated, the on cost will be included as an invoice line when generating the agency-to-host invoice for the timesheet |
| Calculation method |
Basic - in standard on costs, the calculation logic that is used is fixed Advanced - a feature enhancement of our existing on cost capabilities |
Include On Costs in the invoices
This feature is a new add-on to the existing on costs module. When activated for a selected on cost, the on cost will be calculated as normal. However, when an agency-to-host invoice is generated for the timesheet, the on cost will also be included as an invoice line.
Activation process
On costs are included in invoices by activating the feature at an individual on cost level. From the on costs page within company settings, open the on cost settings modal:
Within the modal, click Yes for the “Include on cost in invoice” setting:
Selection of account code
Upon activating the feature, the user will be required to enter or select an invoice account code. This account code is used when the invoice line is created:
Generation of invoice
When agency to host invoices are generated for timesheets containing on cost(s) with the feature activated, the on cost(s) will be added as a new invoice line:
Note: This feature is only compatible with Agency on costs (i.e., only compatible with Agency to Host invoices). If the on cost type is changed to “Admin,” the option to include on cost in the invoice is hidden.
Advanced On Costs
Advanced On costs is a feature enhancement of our existing on cost capabilities. For reference, on costs in Xemplo enables Time-to-Bill clients to reference associated assignment expenses with their pay and charge rates, providing a more accurate indication of their margin. For instance, if an agency bills a client $50 per hour for a worker's assignment while paying the worker $35 per hour, the $15 difference between the rates doesn't solely represent the agency's margin, as they will also incur costs, such as,
- Admin Fees (could represent 13%),
- Payroll Tax (around 5% depending on the state), and
- Insurance (typically 12%).
With the on costs feature, clients can customize these values, ensuring they are factored into the timesheet calculations when it transitions to a verified status. Clients can then reference the values within the timesheet’s detail view:
They are also displayed when an on cost margin report is generated:
Creating an Advanced On Cost
Creating an advanced on cost is done via the same process as creating a standard on cost. Within the company settings for an Agency company, navigate to On Costs and then click on New On Cost.
Once the calculation method is changed to “Advanced” you will notice that a message is displayed, informing you that you must first save the on cost before the formula can be entered. This is a necessary step to allow the on cost to be available in the list of variables:
After clicking Save the modal will re-load with the formula builder visible:
You can now start building their desired calculation formula using a mix of numercial values, operators, brackets and by inserting variables from the list provided. When a variable is clicked from the list, it is inserted into the formula as a coded element, similar to the way that cells are referenced in excel formulas:
Once the formula has been entered, clicking Save will save the on cost configuration.
Formula Builder
The formula builder is similar to the formula field you find in Excel which allows you to create a mathematical equation using numbers or references.
When creating or editing an on cost, users now have the ability to switch the Calculation Method between Basic and Advanced. Basic uses the existing logic functionality (fixed calculations) while Advanced activates the use of the formula builder for specifically defining the calculation logic:
The advanced formula field allows for the entry of:
- Numerical values (0-9)
- Operators:
- Plus (+)
- Minus (-)
- Divide (/)
- Multiple (*)
- Brackets “(“ and “)”
- Variables
Inserting Variables
The following variables are available to be inserted into the formula to allow a user to include dynamic variables into their calculations:
| Variable | Description |
| Pay Total | This is the total pay amount for the timesheet |
| Charge Total | This is the total charge amount for the timesheet |
| Allowance Total | This is the total for any allowances in the timesheet |
| Expense Total | This is the total for any expenses in the timesheet |
| Existing Pay Categories | All pay categories that are setup for the agency are listed as individual variables that can be inserted into the formula |
| Existing On Costs |
All on costs that are setup for the agency are listed as individual variables that can be inserted into the formula The value of the on cost variable is the input value, not the calculated value, see note below. |
| Calendar Days |
The total number of calendar days in the timesheet’s period. |
| Working Days |
The total number of working days in the timesheet’s period. |
| Days Worked |
The total number of days worked in the timesheet’s period. |
| Hours Worked |
The total number of hours worked in the timesheet’s period. |
Using on costs within another on cost formula
When an on cost is created it has two values, an input value and a calculated value. The input value represents what the on cost is configured as. For example, a payroll tax on cost may be configured at 5.45%. The calculated value represents the final amount of the on cost, once a timesheet has been verified. The following example shows this difference:
| Input value | 5.45% |
| Pay Total (example) | $500 |
| Calculated value | $27.25 |
When an on cost is inserted as a variable into a formula, the input value is the value that’s used. This is an important consideration when a user is defining formulas.
Example
A client wishes to create an insurance on cost that takes the pay total, adds payroll tax (which is setup as an existing on cost) and then multiplies this by the insurance %. The values are as follows:
| Payroll Tax % (existing on cost) | 5.45% |
| Insurance % (new on cost) | 12% |
| Pay Total | $500 |
The expected outcome for this calculation is:
$500 + ($500 * 5.45/100) * 12/100 = $63.27
To achieve this calculation, the new insurance on cost is created and then, via the advanced on cost formula builder, the entry would be:
[pay total] + ([pay total] * [payroll tax on cost] / 100) * [insurance on cost] / 100
Editing an Advance On Cost
Editing an advanced on cost is a similar user flow to creation. Via the agency company settings menu, click On costs and then click on the existing on cost to edit:
The same modal from the creation flow will be displayed, allowing all configuration settings (including the advanced formula) to be edited accordingly:
Note: When the calculation formula for an advanced on cost is edited, it will only affect timesheets that are verified after the change has been made. Editing the calculation formula does not affect timesheets that have already been verified.
Deleting an Advance On Cost
To delete an on cost (with either a basic or advanced formula) Click on the On costs link from the company settings menu and then, using the … for the on cost to delete click the delete option: