Project groups are used to determine automatic account postings in the project module.
The user will need to:
- Enter a project ‘Group’ (Optional text)
- Enter a project ‘Name’ (Optional Text)
- Select whether this is to be the default group i.e. if no group is selected on a project, then this default group will automatically be selected.
- Set up a voucher number series. Read more in the number series article.
- In the ‘Post WIP’ column, users can select whether to post WIP according to the sales value or the cost value.
- If ‘Sales value’ is selected here then expenses and expected revenues will be continuoulsy posted over the duration of the project.
- If ‘Cost value’ is selected then expenses and revenues will be realised upon final invoicing of the project.
Note: A minimum of two groups must be created; one group for billable hours and another for internal, non-billable hours. Note also that the internal hours cannot have ‘Invoiceable’ selected in the groups set up list.
Posting rules are selected on each financial account in the genearal ledger set up. If no account numbers are entered, then there will be NO integration to the ledger.
Work in Progress (WIP)
As described above, the user needs to select whether WIP is to be posted based on the cost or sales price of the project.
If cost is selected then WIP will effectively be used to defer posting the cost of the project to the profit and loss statement. If the cost price is selected then no adjustment set ups need to be created. This applies to both adjustments and invoice corrections.
We recommend setting Cost Prices = < Sales Prices since this gives a good overview of the expected earnings on each project. Any posting that cannot be billed on to the customer can be set to a sales price of zero.
If sales prices are used, then the expected revenue can be tracked in the ledger and reconciled with the Project’s sales value.
If WIP is posted manually rather than automatically, it can be controlled by using our “Include work in progress” function. If the check mark is removed here, then WIP can be posted manually in the ‘Project Post WIP’ screen. (Use a translation tool for the linked article).
Project group accounting
‘Labour’ accounts transfer all ‘Labour’ and ‘Adjustment’ porject category types to the general ledger.
‘Outlay’ accounts transfer the value of all project category types that are not Labour, Materials, Revenue or On-Account invoicing to the general ledger.
‘Materials transfer’, transfers the project category type ‘Materials’ to the general ledger.
‘Adjustment’ transfers project category type ‘Adjustment’ to the general ledger.
‘Invoice adjustment’ transfers the project category type ‘Adjustment’ to the general ledger upon creation of a zero invoice or final invoice.