Home > Operations > Allocating Expenses to a Voyage

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After you commence the voyage and enter port activities and expenses, you can see the Voyage Profit/Loss and the TC/Equivalent at any time in the voyage P&L panel.

The voyage, from load port to load port, is the unit that is central to accounting. Voyage revenues and expenses are allocated to the voyage, which is straightforward for freight, port expenses, demurrage, and miscellaneous invoices. However, bunker costs and Time Charter hire expenses can be difficult to tie to a voyage. You are paying upfront, but the expense might cover several voyages, or there might be multiple payments for one voyage. These expenses go to inventory accounts and need to be allocated to a voyage. Voyage Period Journals enable you to allocate your prepaid expenses, such as hire and bunkers, to the proper expense accounts.

Bunkers

Because fuel is generally used on more than one voyage, its cost must be allocated to each voyage. The method of allocation is an accounting decision. The allocation depends on the Bunker Calculation Method, the method of valuing the fuel onboard, which is selected in the Voyage Manager. The calculation happens automatically, as part of the P&L.

Example

You buy 1,000 MT of IFO at $400 (= $400,000), then 600 MT at $500 (= $300,000). You consume 700 MT on a voyage. How are costs allocated to the voyage?

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As the voyage progresses, you might buy more fuel; if you do not use it on this voyage, it does not affect this voyage's costs. If you change the voyage, the change in fuel needed is estimated. When the voyage is completed, and the Completed check box is selected, the accounts can be reconciled. On the Voyage Cost Allocation form (enabled by configuration flag CFGEnableVCA), select the Post Bunker Cost check box to send a message to Financials to allocate the bunker costs to the voyage.

To get the most information about bunkers, see the Bunker Details on the Voyage Profit & Loss Report. In the Voyage Manager, click  and then click Voyage Profit & Loss Report. Select Details and Bunker Details and then click OK.

Posting Bunker Costs

You can post bunker journals from Voyage Period Journals in Financials. Security access can be restricted with Module Rights so that, for example, only Operators can post Voyage Bunker Period Journals.

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When the Voyage Period Journal Entry is posted, it appears in the Posted column in the Voyage Manager under Bunker Expenses. If any changes are made to the voyage that impact the bunker expenses, and they have already been posted, the difference is calculated, which can be posted.

Bunker Breakdown Example

Time Charter Hire

If you Time Charter In a vessel for a year, you might use it for several voyages during that time. Because you are paying a daily rate for the vessel, hire is allocated on a time basis. However, if you are paying in 15-day increments, those might not line up with voyages.

Using a balance sheet and paying every 15 days, for a 60-day voyage, you can then use a Journal Entry to associate those four payments back to the voyage.

You can post TC In Hire from the Voyage P&L, using the Voyage Period Journals button, or from Voyage Period Journals in Financials.

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