If your company is an engineering, construction, managed IT services, marketing or other type of billable services you know efficient project accounting is essential to maintaining profitability. Integrated systems are key to successfully plan, manage and execute projects on ti-+me and on budget. There are 4 key ways an integrated project accounting software ensures that projects maintain profitability when set-up properly.
4 Ways to properly set-up project accounting systems:
- Automatically track all costs to projects
- Automated Revenue Recognition
- Automated time and expense management on-time and on-budget
- Allow users to monitor and manage changes with real time integration
If your project accounting software accomplishes the above automated goals you will be in a position to overcome the most common challenges of project-based professional services. Project based companies need to manage, track and allocate resources and costs by project. Not all ERP systems have the functionality to track all project costs. This presents a challenge for Professional Services organizations where costs need to be tracked by project, billing rates vary by resource or task, revenues need to be recognized by the percent complete, and changes to the project scope need to be communicated in real time to both internal and external team members. If the project costing system is too complex it can be cost prohibitive to have team members enter the data required to capture valuable time, expense, change orders, and even inventory requirements.
4 Key Project Accounting Software Benefits to Tracking All Costs to Projects
Acumatica’s Project Accounting software module addresses this need by seamlessly integrating General Ledger, A/P, A/R, Inventory, Purchase Orders, Sales Orders, and Time and Expenses to automatically track project costs and budget.
The key benefits of project cost tracking include:
- Total View of All Costs:
- Gain a complete view of project-related costs for materials, labor, services, and inventory items for completed work and work in progress. Track employee time, subcontracted services, materials, and inventory.
- Expense Allocation:
- Allocate overhead and shared expenses to individual projects including billable or non-billable items.
- Budget Tracking:
- Compare actual project costs with original and revised budgets and forecasts by period using real-time reports. Include inventory items, non-stock items, labor, services, and more in project budgets.
- One Easy to Use Software Solution
- The ability to manage different lines of business within one easy to use software system is invaluable for business today. Manufacturers, distributors, IT service companies and more. have the need for additional functionality without adding separate software solutions that have to be interfaced to the accounting and inventory software. With Acumatica companies have the option to add modules as their business grows and changes. Service Management with resource scheduling, manufacturing, customer portals and more are all available as options with Acumatica.
4 Key Project Accounting Software Benefits to Flexible Project Billing and Revenue Recognition
Acumatica’s Project Accounting handles the most complex project billing rules and easily calculates project revenue in multiple currencies based on key project-specific attributes.
The key benefits of advanced billing include:
- Multiple Billing Scenarios:
- Cost plus, fixed price, time and materials, milestone billing, and contract-specific pricing are all available. Billing can be defined by customer, type of work being performed, or specific project contract. Billing on cost-based projects can be capped.
- Labor Cost Rate Flexibility:
- Ability to define labor costs by employee, labor item, project, project task, and rate type simplifies time entry and improves visibility. Integrate payroll and HR systems with projects, tasks, and cost codes.
- Recognizing Revenue:
- Option to recognize revenue based on percentage of project completed or tasks completed. All project revenue recognition rules are automatically reflected in the GL journal entries.
- Company-Specific Financial Periods:
- Multiple companies are no problem. Companies can have a different fiscal year-end dates, important for companies that share vendors, stock items, and employees.
Recognizing revenue for completed projects and work in progress makes tracking profitability for fixed price, cost plus, milestone and other billing easy.
3 Key Project Accounting Software Benefits Time and Expense Management
Acumatica’s Project Accounting module helps businesses monitor labor and materials costs by providing tools for employees to track their hours and expenses, automated processes for managers to approve reimbursement requests, and reports to track and control labor costs. Acumatica includes a comprehensive approval process for accuracy, control and anytime anywhere accessibility, time and expense management is integrated with Projects, A/P, and A/R for proper billing.
The key benefits of time and expense management include:
- Labor Tracking for employees, subcontractors Customer, Contracts, and Projects:
- Employee time reports and expenses are automatically assigned for approval. Time and Expenses feed into the Projects module with flexible billing rules.
- Employee or Subcontractor Expense Processing:
- Employees submit expense claims, easily with their camera and mobile phone. Claims can follow a predefined approval process. Payments are automatically created in A/P for reimbursement and can be invoiced if it is a billable expense.
- Time and Expense Entry is Simple and Convenient:
- Employees and subcontractors can enter time and expenses on any Apple or Android device using the Acumatica Mobile App and attach photos of receipts. Approval workflows and can be based on multiple criteria and with multiple approvals on any Internet enabled device.
Join us for our webinar on Wednesday, February 12, 2020 to learn how project-based companies increase profitability using modern technology systems and strategies.
This is now a webinar recording!
4 Ways to Improve Project Accounting Profitability
We will demonstrate the following:
- How to automate cost tracking
- How to automate revenue recognition
- How to automate time and expense management on-time and on-budget
- How to monitor and manage changes with real time integration
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