Project records are used to keep track of costs and/or expenses incurred during a contract or job that your company performs for customers. Projects enable you to keep detailed information about the revenues and expenses associated with the work your company does. You can then review this information in a number of project reports to ensure that work is being done on time and on budget.
Why should I use projects?
Project information is extremely valuable when you want to determine if a specific business activity is profitable. It is also useful if you need to decide if a new venture is going to make money (you can compare the actual cost of a project to a budget estimate and spot potential cost overruns early). Projects are commonly set up to store details of expenses and revenues associated with an event, a customer, or a location.
Benefits of using projects
- Track a project's costs and earnings with project budgets.
- Allocate transaction amounts (including payroll expenses) to specific projects.
- Analyze project performance with summary or detailed project reports.
- Use an industry-specific terms for your projects (jobs, bookings, events)
Examples
- Construction/Contractor company. Your company offers building renovation services and has hired an additional carpenter on staff full-time. Set up projects for each customer to help determine if hiring an additional staff person has helped to increase your company's profitability.
- Facility Rental company. Your company manages several community centres which you booked out to a variety of customers and organizations. Set up projects for each location to track all facility rental costs, and generate reports to help determine which location is earning (or losing) the most money.
- Non-profit organization. Your company runs fundraising activities throughout the year. If you set up a project for each event, you can track funds generated (through donations and pledges) against the program costs (facility rental, special guest fees), and determine which fundraising activities are the most lucrative.
Why can't I just use departments?
Departments are tied to accounts, and are useful for tracking revenues or expenses generated by a specific business function (marketing, administration). A project record allows you to generate reports on several activities related to a specific customer or job.