Accounting Software – The Benefits of Project Tracking

Project tracking within your accounting software program is a great way to understand the cost of a project. It is fairly easy to set up and manage. Once set up, you track projects by attributing income and expenses to projects each time you enter them. Project tracking is not to be confused with ‘job costing’, which is a more complex function that includes the tracking of a job’s progress, timing, and other information; whereas project tracking deals mainly with the income and expense for a project. Here are the basics of project tracking, so you can decide if it’s the right thing for you to do for your business.

Setting up projects

If your accounting software includes the ability to track projects, you should be able to go into your setup options to create a new project and give it a name and/or an abbreviation. Make sure the name is easily recognizable, so it’s easy to identify during data entry. Keep in mind that you may actually have more than one project within a bigger project, so the name you give each project should reflect that. Otherwise, finding the right project can be confusing during data entry.

Assigning a project during transaction entry

Typically, once this is set up, a field within the transaction entry screen(s) will show you the projects you have available to choose from. Be sure to choose the correct project for that income or expense. If you forget to choose a project to associate with that transaction, most systems will let you edit the invoice afterward.

Getting reports by project

Most accounting systems will allow you to filter a variety of reports by project. Whether you are looking for a sales report, financial or general ledger report, use a filter within your report generation tool to include only the information that relates to your project. By filtering the reports this way, you won’t need to sort through loads of other information to get the information you are looking for.

When you are finished tracking a project and have all the information you need, many systems will allow you to mark that project inactive, keeping your list of projects to choose from accurate and easy to work with.

Once you set up and use project tracking, you might just be surprised how easy it is to keep track of even the smallest of projects. Keep in mind, that many systems also allow you to assign projects to your labor costs for a more accurate picture of complete project costs. Check your system today and give project tracking a try!

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