Project Accounting
Integrate project management with accounting in Odoo. Track costs, automatically invoice from timesheets and tasks, analyze project profitability in real-time.
Overview
Project Account module connects project management with the accounting system in Odoo, allowing businesses to track actual costs, invoice from completed work, and analyze profitability of each project.
Automatically convert timesheets, expenses, and tasks into customer invoices, while tracking labor costs, materials, and other expenses to evaluate project financial performance.
Key Features
Key points
• Project cost tracking - Record labor costs from timesheets, material costs, incidental expenses
• Invoice from projects - Automatically create invoices based on approved timesheets, completed tasks, or milestones
• Profitability analysis - Compare actual revenue and costs, calculate profit margin by project
• Budget control - Set project budgets, alert when exceeding budget
• Analytic accounts - Link projects with analytic accounts for detailed cost tracking
• Project financial reports - View P&L reports, costs by phase, profit forecasts
• Multiple invoicing types - Support invoicing by hour, milestone, task, or fixed price
• HR integration - Calculate labor costs based on actual employee salaries
Target Users
Key points
• Project managers - Track project costs and profitability, control budgets
• Accountants - Invoice customers, record project costs, reconcile accounts
• Finance directors - Analyze project profitability, evaluate investment efficiency
• Project staff - Record timesheets and incidental expenses
• Sales staff - Track revenue and payments from customers
How to Use
Steps
1. Create new project in Project module
2. Set up Analytic Account for the project
3. Configure invoicing method: by hour, milestone, task, or fixed price
4. Set project budget if cost control is needed
5. Staff record daily timesheets, select corresponding project and task
6. Record incidental expenses (materials, travel, other) to project
7. Approve timesheets and expenses
8. Create invoice from project: Project → Invoicing → Create Invoice
9. Select timesheets/tasks to invoice
10. Confirm and send invoice to customer
11. Track project profitability in Profitability report
Scenario 1: Hourly consulting project
IT consulting company performs project for client, charges based on actual hours worked. Staff record daily timesheets, automatically create invoice at month-end based on total approved hours.
Configuration: Service Product with Invoice Policy = "Based on Timesheets", hourly rate. Timesheets are approved and automatically converted to invoices.
Scenario 2: Software development project by milestone
Mobile app development project with 4 milestones: UI Design, Backend API, Frontend, Testing. Each milestone has fixed value, invoice when completed.
Configuration: Create Sale Order with 4 lines for 4 milestones, Invoice Policy = "Based on Milestones". When milestone completes, create invoice for that line.
Scenario 3: Construction project with material costs
Office interior construction project, including labor and material costs. Need to track material purchase costs and include in customer price.
Configuration: Record timesheets for labor, create Purchase Orders for materials and link to project. Material costs automatically recorded to project analytic account.
Scenario 4: Fixed-price project requiring budget control
ERP implementation project with fixed price of 500 million, estimated cost budget of 350 million. Need alert when actual costs exceed budget.
Configuration: Set up Budget for project with 350 million limit. System alerts when timesheet costs and other expenses exceed threshold.
Scenario 5: Multi-project profitability analysis
Finance director needs to compare profitability of 10 running projects to decide resource allocation.
Usage: Project Profitability report, filter by "In Progress" status, sort by profit margin. View detailed costs and revenue for each project.
Important Terminology
Key points
• Analytic Account - Management accounting account to track costs and revenue by project, department, or activity
• Timesheet - Record of employee hours worked for each project and task
• Invoicing Policy - Rules for creating invoices: by timesheet, milestone, task, or order
• Milestone - Important project checkpoint, often used for phase-based invoicing
• Project Profitability - Difference between project revenue and costs
• Cost Rate - Actual cost per hour of employee work, used to calculate project costs
• Sales Price - Price charged to customer, may differ from cost rate
• Budget - Estimated cost limit for project
Tips for Effective Use
Key points
• Set accurate cost rates - Configure actual labor costs for each employee to calculate profit accurately
• Approve timesheets regularly - Approve timesheets weekly to ensure accurate data and timely invoicing
• Use analytic accounts - Create separate analytic account for each project for detailed cost tracking
• Set budgets from start - Set project budget at beginning to control costs
• Record expenses immediately - Enter material, travel costs as they occur to avoid forgetting
• Check profitability periodically - View profitability report weekly to detect losing projects early
• Link Purchase Orders to projects - When buying materials for project, select analytic account for automatic cost recording
• Use milestones for large projects - Divide project into milestones for progress-based invoicing, improve cash flow
System Requirements
Key points
• Project module installed
• Accounting module installed
• Timesheet module installed
• Sales module installed
• Analytic Accounting configuration enabled
• Access permissions to Project, Timesheet, and Invoicing
Troubleshooting: Cannot create invoice from project
Key points
• Check Sale Order created and confirmed for project
• Ensure Service Product has appropriate Invoice Policy (Timesheets/Milestones)
• Check timesheets are approved
• Confirm timesheets linked correctly to Sale Order Line
• Check "Create Invoice" permission in Project
Troubleshooting: Costs not showing in project
Key points
• Check Analytic Account set up for project
• Ensure timesheet has correct Project and Task selected
• Check Purchase Order linked to Analytic Account
• Confirm Employee has Cost Rate configured
• Check Analytic Accounting access permissions
Troubleshooting: Project profitability incorrect
Key points
• Check employee Cost Rates configured
• Ensure all costs recorded to Analytic Account
• Confirm invoices are posted
• Check for any costs not allocated to project
• Review Purchase Orders linked to correct project
Troubleshooting: Budget exceeded but no alert
Key points
• Check Budget created for Analytic Account
• Ensure Budget Period is active
• Confirm Budget Line has correct Analytic Account
• Check budget alert configuration in Settings
Frequently Asked Questions
Key points
• How to invoice by hour? - Create Service Product with Invoice Policy = "Based on Timesheets", add to Sale Order. Approved timesheets automatically convert to invoices
• How is labor cost calculated? - Based on employee Cost Rate multiplied by timesheet hours. Cost Rate configured in HR Settings → Employee
• Can I invoice partially? - Yes, select specific timesheets or milestones when creating invoice, no need to invoice entire project
• How to track material costs? - Create Purchase Order, select project Analytic Account. Costs automatically recorded to project when receiving goods
• Can one project have multiple Sale Orders? - Yes, one project can link to multiple Sale Orders, useful for long-term projects with multiple phases
• When does profitability report update? - Updates in real-time when new timesheets, costs, or posted invoices occur
Business Benefits
Key points
• Increase invoicing accuracy - Automatically create invoices from actual work, reduce errors
• Control project costs - Track costs in real-time, detect budget overruns early
• Improve profitability - Analyze profit by project, optimize resource allocation
• Accelerate collections - Invoice faster based on actual progress
• Financial transparency - Customers see clear costs based on work completed
• Better decision making - Project financial data helps evaluate performance and plan
• Save accounting time - Automate process from timesheet to invoice