Project financial management is more than creating a budget or generating an invoice.
To understand project performance, organizations need visibility into the entire financial lifecycle. This includes the original budget, planned work, actual labor and expenses, billing activity, and payment status.
Project Insight helps connect these stages so project managers, finance teams, and executives can follow project financials from budget through payment.
The Financial Lifecycle
- Budget
- Plan
- Execute
- Compare
- Invoice
- Payment
- Report
| Stage | Question Being Answered |
|---|---|
| Budget | How much can we spend? |
| Plan | What do we expect the work to cost? |
| Execute | What work was actually performed? |
| Compare | How are we performing against the plan? |
| Invoice | What work should be billed? |
| Payment | What has been paid? |
| Report | How is the project performing financially? |
Start with a Budget
Most projects begin with a financial target. Some organizations use a top-down budget that establishes the total amount available for the project. Others use a target budget to track an original approved amount before detailed planning begins.
A budget creates the financial baseline that future costs can be measured against.
Related articles:
- How to Set a Top-Down Project Budget in Project Insight
- How to Track a Target Budget in Project Insight
- How to Use the Portfolio Allocation Budget Report in Project Insight
Plan Expected Costs
Once a budget is established, teams can build a more detailed financial plan. This may include planned labor, planned expenses, resource assignments, rate cards, labor costs, and non-labor costs.
Planning expected costs creates the foundation for planned versus actual reporting later in the project.
Related articles:
- How to Use the Task Budget Tab in Project Insight
- How to Use Rate Cards in Project Insight
- How to Use Burden Rates to Calculate Labor Costs in Project Insight
- How to Add Non-Labor Costs and Billable Expenses to Tasks in Project Insight
- How to Add Work Expense and Work Billable Expense Details in Project Insight
Capture Actual Labor and Expenses
As work is completed, actual financial data begins to accumulate. Time tracking captures labor effort while expense reports capture non-labor costs such as travel, materials, contractor expenses, and purchases.
Actual costs provide visibility into what the project is truly consuming.
Related articles:
- Time Tracking and Timesheets
- Expenses and Expense Reports
- How Project Costing Works in Project Insight
Compare Planned vs. Actual Performance
Financial visibility improves when actual costs can be compared against the original plan. Project Insight supports reporting that helps teams evaluate planned labor versus actual labor, planned expenses versus actual expenses, budget variance, estimate at completion, earned value, and planned value.
These comparisons help project managers identify issues before they become larger financial problems.
Related articles:
- How to Configure Variance Calculation Fields in Project Insight
- How to Use Work Estimate at Completion and Work Estimate to Complete in Project Insight
- How to Use Planned Value and Earned Value in Project Insight
- Tracking CapEx and OpEx in Project Insight
Connect Project Work to Billing
Once work has been completed, organizations often need to connect project execution to customer billing. Depending on the billing model, invoices may be based on fixed-price agreements, milestone billing, time and materials, approved expenses, or proposal amounts.
Invoice records help connect project delivery with billing activity.
Related articles:
- Invoice Records
- How to Track Fixed Price Billing in Project Insight
- How to Work With Proposals and Proposal Templates in Project Insight
Connect to Accounting Systems
Many organizations use Project Insight alongside accounting platforms. Integrations help reduce duplicate entry and create a more connected financial process.
Common workflows include connecting project financials to QuickBooks Online, QuickBooks Desktop, NetSuite, or other systems through available integrations and API workflows.
This allows project teams and finance teams to work from connected financial information.
Related articles:
Report Across the Entire Lifecycle
When budgets, plans, actuals, invoices, and payments remain connected, organizations gain a more complete understanding of project performance.
Reports can help answer questions such as:
- Are projects staying within budget?
- Which projects are consuming the most resources?
- What work has been invoiced?
- What remains to be billed?
- How is project profitability trending?
The result is better visibility into project financial performance throughout the lifecycle of the project.
Watch Related Video
Watch the Project Budgeting Power Tutorial
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