Introduction to Project Costings
This functionality is commonly known as “Job Costings” or “Jobs & Resources” to Microsoft Dynamics users. Within Business Central it is possible to manage a variety of tasks, inventory items (if applicable) and resource quickly and easily. This can be done for one or multiple projects. It allows a very simple way to manage project costings for a business. It also ensures easy invoicing per project.
This functionality is suitable for a diverse range of industries, not just large organisations or industrial businesses. For example, financial institutions, logistics companies, the hospitality sector, and crewing organisations.
Using Project Costings is a simple way of keeping track of work being carried out. It can also track chargeable time against budgets within your business. This in turn helps you quantify organisation profitability. It also monitors productivity with greater visibility of your resource usage, be it items/inventory or employees’ time.
What can using Project Costings do for your business?
Managers will have an overview of not only individual projects and tasks, but also the allocation of employees, machinery and other resources being used. Using Jobs and Resources functionality within Business Central you can:
- Create jobs, assign tasks and prepare job planning lines
- Allocate resources to jobs and manage resource prices
- Create timesheets with integrated job tasks, planning lines and then post timesheets to a job journal
- Budget for resources to be used in jobs and compare budgeted to actual usage to improve the quality and cost efficiency of future projects
- Review and record usage on various parts of the job, which is automatically updated as you modify and transfer information from job planning lines to job journals, or job invoices for posting
- Purchase supplies for a job, either on purchase orders or invoices, and record items and the times they are required/used
- Record job costs for resource usage, materials, and job related purchase on an on-going basis and invoice the customer, either when the job is complete or according to an invoicing schedule.
Simple Project Costing example: An office move
An example could be an office move. You would need to factor in the removal of old furniture, installation of new furniture, painting and decorating, technical installations and so on. All of these can have separate tasks setup with a job planning line for each where you would set up your resources, the related costs and prices alongside the dates and timings for any activities to be planned.
Billable and Non-Billable Tasks
Job tasks can be set to be billable or non-billable. This allows you to set up and track, tasks that are to be to invoiced/charged and those that are tasks with no related charge. Therefore, something that is ‘billable’ would be an expense your client agrees to. For example, time an engineer or consultant spends on a job, or database connection fees. Whereas ‘Non-billable’ could be an internal task which could form part of your business as usual activities, or work carried out as part of a contract or agreement that is billed separately.
Costs can be set up for all items which will feed into any profit and loss reporting to show project profitability information.
Getting ready to using Project Costings
For use on both internal and external projects, before you can use Job Costings to manage projects, you need to set up your resources, timesheets and jobs. Once this has been done, you’ll be able to create jobs and schedule resources to go with them, as well as manage budgets, track and pay expenses, employee hours and timesheets.
By Jane Ralphs – Client Delivery Director