Chargebacks › Department Recovered Costs › By Example: IT Departments Aren't Cost Centers Any More

By Example: IT Departments Aren't Cost Centers Any More

Forward Inc offers its business units a wide variety of IT supporting services, including email support, desktop support, and network support. The services are vital for each business unit to maintain their lines of business. Each of these departments are charged for those services. Each department that delivers services receives credit for work performed.

Approved Invoices Charge Costs to Departments that Benefit from Services

Department invoices are generated, reviewed, and approved on a quarterly basis by the departments that benefit from services delivered to them. Corporate Human Resources has subscribed to several IT services and has agreed to accept charges for a portion of these services. The Human Resources department has approved an invoice that totals $7,400.

Charged Costs Translate into Credit for Departments that Deliver

The IT Delivery Services department receives credit for services provided. The department manager can view incurred costs and credits by viewing the department recovery statement. This statement shows that some charges were approved and the department has recovered $7,400 so far. Other department managers have yet to approve their charges. The charges appear as recovery variance.