Staff Variables
This article explains Staff variables in Model Reef.
You will learn:
What a Staff variable represents.
How Staff variables handle salary, oncosts and timing.
How Staff costs affect P&L, Balance Sheet and Cashflow.
Patterns for modelling headcount, wages and payroll related costs.
Staff variables are a specialised type of Opex variable with payroll aware behaviour.
What a Staff variable is
A Staff variable represents employee related costs, for example:
Salaries and wages.
Superannuation or pension contributions.
Payroll taxes.
Bonuses and commissions.
Other employment oncosts.
Staff variables are usually structured around:
Headcount or FTE drivers.
Average salary or cost per head.
Oncost percentages for super, pension and payroll tax.
How Staff variables use drivers
Typical Staff formulas include:
Staff Cost = Headcount * SalaryPerHead * OncostFactor.Headcount = BaseHeadcount + NewHires - Leavers.CommissionCost = Revenue * CommissionRate.
Where:
Headcount, salary and commission rates are drivers.
Wage inflation may be represented by a separate economic driver and applied as escalation.
This keeps pay structures and headcount planning visible and adjustable.
Staff costs in the P&L
In the P&L:
Staff variables reduce EBITDA.
Staff lines are usually separated from other Opex to highlight labour intensity.
You can break Staff variables into categories such as
Staff - Engineering,Staff - Sales,Staff - Operations.
This structure supports analysis of staff cost by team, function or region.
Staff payables, timing and cash
In the Balance Sheet:
Staff variables create payables if wages, super or payroll tax are paid after they are accrued.
For example, salaries accrued in a month but paid at month end or in the following month create a short lived payable.
All Staff related timing differences are reflected in the same Accounts Payable bucket, with category detail available for drill down.
In the Cashflow Statement:
Staff variables contribute to Payments to suppliers (operating cash outflows).
The timing reflects pay dates and employer obligations rather than accrual timing.
The timing engine ensures that Staff costs line up with payment cycles realistically.
Headcount and capacity modelling
You can combine Staff variables with operational drivers to build capacity models, for example:
CapacityHours = Headcount * HoursPerFTE.RequiredHeadcount = WorkloadHours / HoursPerFTE.Linking required headcount to hiring plans and Staff cost variables.
This supports modelling of:
Hiring ramps.
Capacity constrained growth.
Productivity improvements.
Scenario work with Staff variables
Scenarios often differ in Staffing assumptions, for example:
Aggressive hiring in Upside scenarios.
Hiring freezes or slower replacement in Downside scenarios.
Different bonus schemes or commission structures.
Because each scenario is a separate model, each can have its own Staff drivers and variables while reusing the same structure.
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