Most Project Businesses Find Out a Project Lost Money After It Has Finished
By then nothing can be done about it. The hours are booked, the materials are consumed, the client has been invoiced whatever the contract allowed. This module is project accounting, not task tracking. It puts budget, cost, revenue and margin on the same ledger as the rest of the business so the number is visible while the project is still running and the outcome can still change.
50+ ERP and software projects. Zero failed projects since 2021.
The margin you find at the end is the one you could not change
A project business does not fail because one project went wrong. It fails because it could not tell which ones were going wrong until the invoices stopped. Two things fix that, and neither of them is a nicer Gantt chart: a budget broken down to a level people will actually maintain, and time captured accurately enough that the cost figure is believed.
Budget at the level you can actually control
A work breakdown structure splits the project into phases, then tasks, then cost elements: labour, materials, subcontract, expenses, plant. Each gets a budget. The temptation is to break it down finely, on the theory that more detail is more control. It is the opposite. A WBS broken down more finely than anybody will maintain produces worse information than a coarse one that is kept current, because nobody codes their time to the right line and the variance report becomes noise. Break it down to the level where a named person can be asked why a line moved.
- Phases and tasks, with a budget on each cost element.
- Cost elements that match how the work is actually bought.
- A coarse structure kept current beats a fine one nobody updates.
Time recorded a week late is close to fiction
Everything else on this page rests on the timesheet. Hours booked against a project and a task, flagged billable or non-billable, approved by a manager before they are costed. The single largest accuracy gain comes from when the entry is made. Time entered at the end of the day is materially more accurate than time reconstructed on Friday afternoon from a calendar and a memory, and reconstruction is the main reason project cost data is not trusted inside the business. If the finance team quietly keeps a shadow spreadsheet, this is almost always why.
- Booked against project and task, billable flag on every line.
- Approved before costing, so the ledger is not correcting itself later.
- Captured at the end of the day, not rebuilt at the end of the week.
Six areas, and all six post to the same ledger
Project accounting only works if the cost side and the revenue side sit in one system. Split them across a task tool and a bookkeeping package and you will spend every month end reconciling two versions of the same project.
The project lifecycle, from budget to closing review
What we set up when we configure this module
WBS and budget template
A project template with your standard phases, tasks and cost elements, so every new job starts from the same structure and reports compare properly.
Timesheet and approval flow
Entry screens per role, billable flags, an approval route that fits your managers, and cost and billing rate cards per grade and per client.
Billing model configuration
Milestone schedules, time and materials rules, caps, retainer draws and cost plus fees, each wired through to the invoice and the receivable.
Revenue and WIP postings
Percentage of completion set up with the accounts for accrued revenue, work in progress and deferred revenue, agreed with your accountant first.
Change order control
A variation raised, priced, approved and then applied to budget and contract value, with pending scope visible while it waits.
Margin and utilisation reporting
Margin by project, by client and by project manager, plus a resource view that shows commitment and utilisation without flattering either.
What project accounting actually buys you
What this connects to
Project accounting is only complete where it meets the payroll and the ledger. Here is where it hands off, and who configures it.
Why teams hand us the project module
Project management module questions
How is this different from a project task tool like Asana or Jira?
How does time capture work, and does it feed payroll?
Which billing models does the module support?
How do revenue recognition and work in progress work?
Can we see project margin while the project is still running?
How are change orders and scope creep handled?
Make Your Project Margin Visible
Book a free consultation. We will look at your contracts, how your people record time today and where cost currently goes missing, then tell you what a project accounting setup would actually change for you.
Book a Free Consultation →An honest position first: this module will not manage your projects for you. It makes them measurable. A project manager who is not looking at cost against budget every week will get exactly the same nasty surprise as before, just with better documentation of it.
What the Project Accounting Module Covers
Cost on one side, revenue on the other, and a forecast in the middle that you can still do something about. Here is what gets built: the budget structure, the capture of time and cost, the billing models, and the accounting that turns delivery into recognised revenue.
From a budgeted work breakdown to recognised revenue
Every cost the job causes, on the job
Labour comes from approved timesheets at a cost rate per person or grade. Materials come from stock issues against the project, valued the way the rest of your inventory is valued. Subcontractor invoices, travel and other expenses, and plant or equipment time all carry the same project code. The point is completeness. A project cost that covers labour and nothing else will always look healthier than the job actually is, and that is the figure most businesses are quietly running on.
- Approved time costed at grade or person rates.
- Materials issued from stock, not typed into a spreadsheet.
- Subcontractors, expenses and plant on the same project code.
Five billing models, and what each does to your cash
Fixed price with milestones gives predictable revenue and puts the estimating risk on you, and the cash profile is decided entirely by how the milestone schedule is drafted. Time and materials passes the risk across but invites drift. Capped time and materials gives the client the comfort of a ceiling and gives you the downside of both models. A retainer smooths cash and hides utilisation problems. Cost plus removes the risk and needs open books. Choose on how well the scope is understood, not on habit.
- Milestone certificates that trigger the invoice and the receivable.
- Caps and retainer draws tracked against consumed value.
- Unbilled time and cost surfaced before every invoice run.
The estimate at completion is the number that lets you act
Cost to date tells you history. Estimate to complete, reforecast monthly at minimum, plus cost to date gives estimate at completion, and that is the only figure a manager can still change the outcome with. Assuming the original budget still holds is how a project stays green until the week it turns red. Alongside it sits the resource view: who is committed where, what is free, and utilisation as a rate. Be careful with that last one. Chasing a very high utilisation target destroys the slack a business needs to win work and absorb overrun.
- Monthly reforecast built into the calendar, not requested in a crisis.
- Change orders priced and approved before they touch the budget.
- Utilisation reported honestly, not set as a target to hit.
Everything the module delivers
Budgeted work breakdown
Phases, tasks and cost elements with budgets, a held baseline, and a reusable template so projects compare with each other.
Timesheets and approval
Daily entry against project and task, billable flags, manager approval before costing, and rate cards by grade and client.
Complete project cost
Labour, materials, subcontract, expenses and plant, plus committed cost from open purchase orders, all on one project code.
Billing model setup
Milestone schedules, time and materials, caps, retainers and cost plus, each wired to the invoice, the tax and the receivable.
Revenue, WIP and deferral
Percentage of completion postings with accrued revenue, work in progress and deferred revenue accounts agreed up front.
Margin and forecast reporting
Margin by project, client and manager, estimate at completion per job, and a closing review that compares estimate to actual.