For over 20 years I had the benefit of having Project Financial Status calculated for me by our (pricey) accounting software after each month was ‘posted’. You could choose from two methods. Method A was automatic but gave useless results. Method B required you to input an overhead factor to allocate overhead per hour of time charged to the project. This method gave consistent results and the results were accurate as long as your overhead factor was up to date.
You can see how to calculate an overhead factor here.
MyCorbu BOOKS (formerly called TIME) now provides the same Project Financial Status as a pricey accounting system. One difference is that MyCorbu does it daily rather than monthly.
Why Bother With Project Financial Status
I think there are several benefits of knowing your Project Financial Status.
How To Determine Project Financial Status
Determining Project Financial Status is pretty simple. You allocate your overhead expenses based on the hours charged to your projects. You simply multiply the Overhead Factor times the individual’s hourly pay rate to get a ‘Charge Rate’. Then add this Charge Rate amount to the project expenses for each hour charged to the project.
MyCorbu does this for you every time you enter time. All you have to do is determine the Charge Rates to use. Here is the link again to see how to do that. https://www.mycorbu.com/blog/billing-overhead-factor
Every few months, calculate your Overhead Factor and update your Charge Rates.
With your Charge Rates in place (here’s where they go), MyCorbu BOOKS provides three ways to check Project Financial Status.
The Three Ways
1) Project-Phase budgets
On the Projects Page, the Project-Phase Budgets table shows you the status of each Project-Phase compared to the budget that you have set.
2) Status Reports (overview)
On the Bookkeeping Page, the “Status Reports” button opens two pivot tables. One shows the status of your business as a whole. The other shows each project’s status.
3) Project Reports (details)
On the Bookkeeping Page, the “Project Reports” button opens a table of your projects showing the financial status of each project. There is a link for each project that displays breakdowns of Time Charges, and all other Income and Expense Transactions.
I think that you will agree that it looks pretty easy to keep tabs on your project financial status.