Architectural Bookkeeping Apps

Architectural Bookkeeping App Evaluation

3/20/2021

Most small firm architects are unhappy with their bookkeeping application. This is an evaluation of what is available.

Architectural Bookkeeping App Evaluation

Unlike all the other posts that you will find here, this is a work in progress. Updates will appear periodically for a month or more. If you would like to get updates by email as they come out, use this form.

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Architectural Bookkeeping - Timekeeping

When you think of bookkeeping, you may not see the need to have timekeeping integrated. However, I think timekeeping is the most important aspect of bookkeeping because it represents management of most of your resources and expenses.

The two most obvious uses for timekeeping are to know how much to pay your staff and to know how much to bill your clients. However, the most valuable use for timekeeping is to know how each project is doing compared to its budget. With this information you can make decisions early to avoid overspending or to avoid missing a deadline. Collecting time daily and seeing the results immediately is correspondingly important.

If you are billing by the hour, you want to have an accurate report on how much to bill. And if you are billing with a fixed fee, you cannot afford to spend unlimited time for a fixed amount of income.

It is also desirable to know that you are on target to be able to bill more than your typical monthly expenses. Just as important is knowing what percentage of everyone’s time is billable. Most firms will find it impossible to be consistently profitable if the percent of billable time isn’t consistently over 65%.

You can find out what your percentage billable should be with this link.

Timekeeping features to look for

Project-based timekeeping
Ability to set budgets and see status
Ability to see the effects of time entries as soon as made
Payroll reporting - doing payroll in-house is never a good idea for small firms
Invoice reporting - Architects’ invoicing is so unique that incorporating actual invoice preparation into the application is often not helpful, but you will need the information that the invoice will contain.
Reporting on the individual and overall billable percentage ('utilization rate' in accountant-speak).

Architectural Project Bookkeeping

The vast majority of small firm architects do not know how individual projects are performing financially. It is very time consuming to evaluate project performance if your bookkeeping application does not do it for you. At the very minimum you need to know how many of your budgeted hours have been spent. Even better is to know how much of your fee has been spent because not all hours have the same cost. Optimally you would also know how project expenses are working out compared to your proposal’s assumptions.

If you don’t know how individual projects perform economically, you may be doomed to repeating mistakes that would otherwise be obvious. In my experience these mistakes always cost you money.

The extra effort to input project information is tiny - an hour or two per project total. The feedback is close to priceless.

It is very important to use a project-based application.

Architectural Fees

Tracking fees is a necessity if only for sending invoices. It ought to be part of your accounting app so that you don’t have to maintain two applications.

Ideally you would track your fees by phase of work or service. You will want to determine the net fee after deducting consultants and other expenses so that you can set a budget.

Very few applications offer all the forms of invoices that architects use. Even those that offer what you need are often flawed in some other aesthetic way.

Having an application that prepares invoices that are acceptable is helpful, but by no means crucial. However, getting invoicing information out of the app is crucial.

Invoicing features to look for

Hourly rate summaries with values
Percent complete per phase
Reimbursable Expenses and Mileage

Architectural Expenses

Having all expenses in one place, whether project or business related is nice to have. Project related expenses are very important. Business expenses less so. You can log and track business expenses with a fairly simple spreadsheet.

With expenses comes categories to put those expenses in. For small firms categories are a distraction. You can get the same information by sorting your expenses by payee to see where the money went. Elaborate account numbers are a time waster because it removes you another degree from your data. I think account numbers are a throwback to early computer systems that could only deal with numbers.

1st, 2nd and 3rd Updates

Here is a link to the first email if you missed it.
Here is a link to the second email if you missed it.
Here is a link to the third email if you missed it.

The evaluation sheet that I am using.

Evaluation Groups 1, 2, 3, 4, 5

Click the Group name to download a PDF of the evaluation forms.

Group 1 includes Airtable, BeeBole, FreeAgent, FreshProjects, Harvest, LessTimeSpent, SmartSheet, and WorkingPoint.
Group 2 includes HubStaff, Mavenlink, TSheets by QB, VeriClock, FunctionFox, TimeSolv Pro, Avaza.
Group 3 includes Clockify, Freedcamp, Timecamp, Toggl, ProofHub, Monday, FreshBooks, Wrike.
Group 4 includes Xero, Trigger, Dovico, 5PM, BigTime, ProjectManager, Teamwork, Ravetree.
Group 5 includes actiTime, Ajera, BQE Core, coda.io, Monograph, Paymo, Squava.

The Comparison Table

This is the completed table.
Click the image to download a PDF that is easier to explore.

This download is a zip containing Excel and Numbers formats of the empty spreadsheet so you can score your favorite options.

Return weekly to see the results of the evaluation unfold. The number of apps is now over three dozen...