Project administration software: control over hours, costs and results

What is project administration?

Project administration, also known as project accounting, is the structured recording and monitoring of all financial and operational data of a project: hours, materials, purchase costs, variations, invoicing and work in progress. The goal is real-time insight into costs, revenue and expected results per project, from quotation to post-calculation.

Good project administration software does not collect this data from loose spreadsheets, but straight from the source: the engineer’s time registration, the digital work order and the purchase invoices in the ERP system. That way the project result always matches the books.

What belongs in a project administration?

A complete project administration contains at least the following elements per project:

• Time registration: hours worked per employee, linked to project phase and rate;
• Materials and purchasing: materials used and purchase invoices, booked directly to the project;
• Variations: additional and reduced work, recorded and approved before it is carried out;
• Work in progress (WIP): the value of work performed but not yet invoiced;
• Invoicing: instalment invoices, partial invoices or invoicing based on actual costs;
• Pre- and post-calculation: budgeted versus actual, per phase and for the project as a whole.

If one of these elements is missing, the familiar pattern appears: the project looks profitable until the last purchase invoices arrive and the additional work turns out never to have been invoiced.

Project administration in Excel or in software?

Many companies start their project administration in Excel. That works fine as long as the number of projects is small, variations are rare and nobody needs to work in the file at the same time. But Excel has no link with hours, purchasing or the accounts: every figure is retyped by hand and is already outdated the moment you look at it.

Project administration software turns this around. Hours, work orders and purchase invoices are recorded at the source and flow to the project automatically. The moment to switch: as soon as you run several projects at once, with several employees per project, and you want to know each month what your work in progress is worth.

Project administration software in Microsoft Dynamics 365 Business Central

Bluace sets up the project administration within Microsoft Dynamics 365 Business Central, the ERP platform that also runs your financial administration, purchasing and inventory. That means: no separate project administration next to the books, but one environment where everything comes together.

This is how it works in practice:

• Hours flow in automatically: office staff register time in Business Central, engineers use the Field Service App and the digital work order. Every line lands on the right project phase;
• Purchasing and materials on the project: purchase orders and warehouse issues are linked to the project at posting, including actual purchase prices;
• Variations secured: additional work is recorded as separate project lines, so it stays visible and gets invoiced;
• Work in progress calculated automatically: Business Central calculates the WIP position per project and posts it to the financial administration using the chosen method;
• Invoicing from the project: instalment schedules, partial invoices or invoicing on actual costs, without retyping from a separate package;
• Pre- and post-calculation side by side: budget and actuals per phase in one screen, with the option to connect the calculation solution for estimating.

Because the project administration is part of the ERP, the project result reconciles with the annual accounts by definition. Your accountant does not have to reconstruct anything, and the project manager looks at the same figures as the finance team.

Project administration for installation and service companies

For installation companies, service and maintenance organisations and project organisations, project administration is a bit more complicated than for a consultancy firm. Projects and service work run side by side: the same engineer works on an installation project in the morning and resolves a breakdown in the afternoon. Materials come from the van, the warehouse or straight from the wholesaler. And variations arise on site, not at a desk.

That is why a watertight project administration in this industry starts at the work order: if the engineer records hours and materials on the right order, the administration completes itself. Bluace therefore combines the project administration in Business Central with the digital work order as standard, as part of the complete ERP solution for installation companies.