Ask a project-based firm how profitable last year’s projects were and they can usually tell you. Ask how profitable the projects running today will be, and the answer is often a guess. The difference is not effort, it is timing: the numbers come together only after the project is closed.
What plan vs. actual needs
To see the margin during a project, three sets of numbers have to meet in one place:
- The plan: revenue, cost and margin per phase, from the current budget revision.
- The contracted amounts: customer contracts and supplier contracts signed so far.
- The actuals: invoiced revenue, received invoices and approved hours at their cost rate.
When all three are visible per phase, a phase that is running over shows up while there is still time to act: renegotiate, change the approach, or raise a change order.
Why it usually fails
The numbers live in different systems: the budget in a spreadsheet, the hours in a timesheet tool, the invoices in accounting. Combining them by hand is slow, so it happens rarely.
Make the numbers come together automatically
The fix is to record the budget, the contracts, the invoices and the hours against the same project and the same phases from the start. Then plan vs. actual is not a report someone builds; it is a page you open.
In Qentrilo, the Project financials and Finance modules connect the budget per phase, contracts and change orders, issued and received invoices and approved hours, so the project’s plan vs. actual is always current. See the platform or book a demo.