ERP Selection Tips for Manufacturers

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Chances are, if you’re in manufacturing, you already have software to manage your operations. It may be time, however, to think about updating that system. With competitive trends accelerating and customer preferences evolving relentlessly, manufacturers are under pressure to adapt and become more agile and better at what they do. New cloud-based Enterprise Resource Planning (ERP) solutions like Acumatica give you capabilities that easily translate into improvements in efficiency, quality and profitability. With that in mind, here area few selection tips for selecting the right manufacturing ERP solution.

Table Stakes

Any worthwhile modern ERP solution will have certain core features. Think of them as “table stakes” to be in the manufacturing software game. These include having a cloud-hosting option and the accompanying flexibility the cloud enables. Cloud computing gets you out of the capital investment (CapEx) you’re accustomed to with on-premises solutions.

A modern manufacturing ERP should also be extensible, with the ability to integrate with other systems using standards-based APIs. Mobility is a given, as is deep data management and analytics capabilities. Security is also “table stakes,” especially considering the emerging risks facing Operational Technology (OT) SCADA systems that may be linked to operational management systems like ERP.

Manufacturing ERP Selection Factors

Assuming the system you have in mind meets the table stakes, consider the following factors when making your selection:

  • It allows you to make decisions with visibility and collaboration. You should be able to use the ERP solution for internal collaboration as well as for coordinating processes with supply chain vendors and customers.
  • A good manufacturing ERP enables you to bring complex, customized products to market in a rapid cycle; it facilitates, rather than hinders, the adoption of new manufacturing methods and technologies.
  • You can manage resources and inventory to keep costs under control and minimize the amount of cash you tie up with inventory.
  • It offers powerful but flexible master production planning and control.
  • The solution handles complexity in the lifecycles of your various products, e.g. multiple versions, revisions, updates, end-of-life, etc.
  • It can easily handle complex product structures that generate Bills of Material (BOMs) with multiple levels.
  • You can set up and implement detailed routings that include processes that occur off of your shop floor.
  • Production scheduling is flexible.
  • Configuration management is easy to use.
  • You can use market data reporting to anticipate supply and demand for materials and finished goods.
  • Cost reporting is fine-grained enough to allow for rigorous cost management and cost cutting that doesn’t negatively affect product quality.
  • BOM costing and production costing allow for roll-up to design and production planning.
  • You can allocate overhead flexibly, by product, product line or business unit.
  • It integrates with the accounting system, including for multiple entities.
  • You can create production orders that track costs for materials, labor and materials as well as overhead that’s either fixed, variable or both.
  • You can integrate with Customer Resource Management (CRM) for sales tracking.
  • It provides Quote-to-Order-to-Invoice capabilities.

This may look like a long list, but it’s really just a sampling of what you should be looking for in a manufacturing ERP solution. We have worked with many manufacturers over the years in the selection and implementation of new ERP systems that are adapted for their unique business needs. If you’re thinking about upgrading your manufacturing ERP, we should probably talk.

Additional ERP Software Resources

How ERP Software Can Save Your Business Money

ERP Software 101: History and Modules Available

7 Signs that You Need ERP Software

Meeting the ASC 606 Compliance Deadline with Acumatica Deferred Revenue Accounting

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Corporate accounting systems must be in compliance with the ASC 606 rule for revenue recognition as of December 15 of this year. This requirement will not be a problem for companies using Acumatica Cloud ERP’s Deferred Revenue Accounting module. Those that don’t have this software or the equivalent will be in a rush to get right with this important accounting rule. So, it’s worth taking a moment to examine ASC 606 as an example of how the interplay between software and accounting rules can affect financial reporting.

A Brief Overview of ASC 606 and Its Implications

If you’re a CPA, ASC 606 is probably not that big a deal. You should already know all about it. However, if you’re in IT and supporting the accounting department or a business analyst trying to build efficient financial workflows, a quick review of ASC 606 is in order. The Accounting Standards Codification (ASC) rule 606 is one of many rules by which companies control their financial reporting. ASC 606 is paired with International Financial Reporting Standards (IFRS) rule 15. The rule is thus known as ASC 606/IFRS 15. In the US, they’re being promulgated by the Financial Accounting Standards Board (FASB), the accounting profession’s rule-making body.

The goal of ASC 606/IFRS 15 is to standardize revenue recognition in accounting practices worldwide. Before these rules were adopted, revenue recognition was not subject to any global standards. Companies in different countries could recognize revenue on different bases. Revenue recognition relates to the period in which a company will claim a sale is actually revenue, for reporting purposes. As a result, it can have an impact on tax liabilities and many other aspects of financial reporting.

A quick cash transaction is easy. If you get paid $100 in cash in 2019 for an order that started and finished in 2019, you will recognize that $100 as revenue in 2019. However, what happens if you get $50 to start an order in 2019 and $50 upon completion of the order in 2020? Under the old rules, some companies might recognize all $100 in 2019 (and pay tax on it in 2019) while others will split it. The second $50 becomes “deferred revenue.” ASC makes everyone follow the same rules for these practices. It has implications for taxes, lending, incentive-based bonuses (e.g. revenue growth bonuses), share prices, entity valuation and so forth.

How Acumatica Deferred Revenue Accounting Enables Compliance with ASC 606

Acumatica Cloud ERP has a portfolio of specialized accounting modules. Deferred Revenue Accounting is one of them. It enables your accounting team to handle the detailed, potentially confusing revenue recognition requirements of ASC 606 in a centralized, intuitive and automated accounting workflow. In particular, the module helps users identify a contract with a specific customer—itself a major component of ASC 606. Revenue recognition is contract-based.

The module then identifies the performance obligations in the contract, such as revenue milestones for partial completion and so forth. It can determine and then allocate transaction prices to specific financial periods. Revenue is then recognized when the performance obligation is satisfied. Acumatica’s Deferred Revenue Accounting module can handle bundled contracts, multi-item contracts and related contracts. The system makes these aspects of ASC 606 compliance compatible with other accounting rules already in place.

Each company will have its own distinct revenue recognition requirements. Acumatica adaptable, allowing for Customized Deferral Schedules based on templates or created from scratch. Users can link schedules to specific transactions and line numbers on income documents.

To learn more about Acumatica’s specialized accounting modules, including Deferred Revenue, contact us today!

Additional Acumatica Resources

7 Signs That You Need ERP Software

Why Acumatica Outpaced NetSuite on the Most Recent G2 Survey

What’s New in Acumatica 2019 R1

How ERP Software Can Save Your Business Money

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Can ERP save your money business? In our experience, the answer is definitely “yes.” Enterprise Resource Planning (ERP) software, used correctly, will drive savings in multiple categories of business operations.

ERP at a Glance

The term “ERP” has become a bit of a misnomer. When ERP made its debut in the 1970s, the technology was all about running big manufacturing plants and handling supply chains and logistics for industrial companies. This is still the core of ERP, but today, an ERP solution can do so much more. In fact, modern cloud-based ERPs like Acumatica can run virtually every aspect of a business. ERP does accounting now, along with service management, Customer Resource Management (CRM), project management, project accounting, Materials Requirement Planning (MRP) and more.

High-Level Cost Savings from ERP

How does use of an ERP solution translate into savings? In the big picture, it’s about operating more efficiently. ERP helps people work more quickly and accurately. Process automation cuts down on error-prone manual steps. Miscommunications about orders, inventory, logistics and so forth generally decline with the introduction of ERP. Learn more about the signs you need ERP software.

When we help a customer deploy ERP, they tend to notice right away how much faster everything starts to move. They didn’t realize before how seemingly minor things like chasing down paper bills of lading or returning phone calls slowed down operations. ERP makes people more productive. With people doing more work in less time, the cost doing business drops.

Part of the productivity gain comes from the centralization of all business management processes into a single system. There’s no more porting of data from operations to accounting software, and so forth. People get a continuous, real time overview of data regarding orders, support cases, inventory and the like.

Where ERP Saves Money, Specifically

On a day-to-day basis, we see ERP saving money for our customers in the following specific areas:

  • Better control over inventory control—Inventory costs you twice. There’s the carrying cost of parking cash in inventory. Then, you have inventory handling costs like shipping and receiving and related accounting tasks. ERP helps you automate many of these processes. And, up-to-date reporting and predictive forecasting—along with smarter production management—help you keep inventory carrying costs to a minimum.
  • A faster, smoother information flow—The centralized nature of ERP and its rich data reporting capabilities, coupled with automated notifications and task management, result in a smoother, faster flow of information across the organization. People can make more informed decisions and stop using email to manage workflows.
  • More coherent supply chain management—ERP enables you to coordinate purchasing and supply chain, monitoring dependencies and keeping everyone involved informed about the latest production statuses. Learn how ERP can promote a sustainable supply chain.
  • More accurate, timely invoicing—An ERP solution speeds your cash cycle with timely invoicing. Learn about the benefits of ERP for accounting and financial management.
  • The ability to anticipate, rather than react to problems—Data visualization and automated alerting can give your team the ability to see potential production and inventory problems in the making. This way, they can solve them or devise a response before they cause trouble.

All of this depends, of course, on how well you implement your ERP. The software alone won’t do much if your people aren’t making the most of it. This is where we can help. We have worked with many businesses on the implementation of Acumatica and other systems. For a demonstration of Acumatica or a consultation on how software can help your business run better, contact us today!

Rein in Privileged Users to Reduce Information Security Risks

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“With great power comes great responsibility.”

That isn’t just a comic book saying; that’s reality. Ensuring that those who have great power use it responsibly can’t be left to chance; that’s also reality. That’s why having a process to monitor and control privileged account usage is a critical piece of ensuring your information security.

Privileged Account Powers

Privileged accounts are the ones with the power of creation and destruction. They’re the administrator accounts that create other accounts and grant powers to other users. They’re the accounts that turn systems on and shut systems down. They’re the accounts that define configurations that control how systems behave. They’re the superuser accounts that can read all data and make any changes. They’re completely necessary, and at the same time, completely dangerous.

Risks of Privileged Accounts

The big risk of privileged accounts is that if they’re compromised—if their credentials are compromised or an employee acts improperly—they can create big damage. Access to all data means all data can be tampered with or stolen. Access to configurations and controls means systems can be altered to behave in unapproved, ineffective, or dangerous ways. Because these accounts are so powerful, they’re tempting targets for hackers. Often, these accounts are ridiculously easy to break, because systems have built-in admin accounts needed to install and configure them for use, and the default settings aren’t changed.

Managing Privileged Account Risk

The first step to managing privileged account risk is to limit privileged account usage. You need to determine where the balance lies between empowering employees and protecting your business. Giving every employee admin access on their PC or to a critical business application may help some tasks get done more quickly, but it also increases risk. Because many companies don’t know where all their privileged accounts are, an audit is often necessary to identify them so they can be managed.

Once you know where the privileged accounts are, you can take steps to control them. This likely means removing privileges from some user accounts. Users should have the minimum set of privileges necessary to perform their job functions. Using role-based access controls can help ensure that only appropriate privileges are granted.

Ultimately, though, some users need privileges. They should each have their own accounts, and passwords should be randomized and changed frequently; passwords that don’t change are vulnerable to attack. Use multifactor authentication to enhance the security of these accounts. Users should access their privileged accounts only when needed to perform a privileged function; actions taken by the privileged accounts should be logged and reviewed.

The reviews don’t need to be manual; there are threat analytics programs that can first identify normal patterns of access and then identify any deviations that may indicate improper use. Should improper use be detected, you need an incident response process that shuts down the account and minimizes damage.

Tools for Managing Privileged Accounts

Tools can help you implement the necessary management and monitoring of privileged accounts. Credentials can be kept in a “vault,” with users required to request access through a workflow. This prevents these accounts from being shared and used without authorization. Delegation allows users to be granted a subset of admin functions. Session monitoring creates a record of user activity within the privileged account.

All user accounts need to be securely managed. CCS Technology Group helps businesses develop and implement comprehensive data security solutions to secure data, networks, applications, systems, and accounts. Contact us to learn more about implementing information security that protects your business.

Additional Information Security Resources

Don’t Overlook These Information Security Basics

Don’t Click That Link! Protect Your Business Against Phishing Emails

7 Common Mistakes That Place Your Data in Danger

Make Sure Your Disaster Recovery Plan Isn’t Just Words on Paper

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A written disaster recovery (DR) plan is a good start towards making sure your business can resume operations after an outage, but you won’t know how good those words are until you put them into action. Because you don’t want to find out your plan is incomplete or incorrect during a crisis, it’s important to schedule periodic disaster recovery tests to try out your plan before you need to execute it for real.

Types of Disaster Recovery Tests

There are several different ways you can test your plan:

  • Circulate for comment. Distribute the plan to everyone who would participate in it and solicit their comments and feedback.
  • Walkthrough the plan. Gather everyone who would participate in the plan in a conference room or on a conference call. Read through the plan as a group—out loud, not silently. Because there is group interaction in this approach, you’re likely to surface issues that won’t be identified when individuals read through the plan separately.
  • Tabletop testing. Similar to a walkthrough, the participants are gathered together. Rather than read through the plan in isolation, they are presented with a typical failure situation and called upon to resolve it. This can identify planning gaps and failures that are not addressed by the DR plan. It’s important to choose realistic failure scenarios and that the participants are not informed of the scenario in advance.
  • Parallel test the plan. Bring up the disaster recovery systems and test whether they can execute a day’s work. The production systems run in parallel, so the only impact on routine business is that some personnel have to perform tasks on the disaster recovery systems.
  • Failover test. Simulate a production outage by gracefully shutting down the primary servers and failing over to the secondary site. This test method impacts ordinary production work so it may be better to execute this process on a weekend or other low volume time period. This process requires additional work to bring the primary servers back online after the test is complete.

Learn more in Craft An Effective Disaster Recovery Plan.

Disaster Recovery Test Follow-up

Whichever test strategy you choose, the test process isn’t over when the final system is brought back online. After the test, the DR plan needs to be updated to reflect:

  • missing applications. It’s not uncommon for applications to be overlooked when the DR plan is written.
  • missing or incorrect steps. The processes for bringing up applications may be missing some steps, miss some dependencies, have steps in the incorrect sequence, or contain errors in the details of the commands to be executed.
  • incorrect timings. Every application should have a recovery time objective which the recovery plan attempts to meet. If the test shows recovery can’t meet those objectives, the plan needs to be revisited to determine how it can be altered.
  • missing communication. Plans often fail because important notification steps are omitted.

In addition, you should always consider how the plan would have worked if this was an actual, unscheduled outage.

Learn more in Don’t Improvise Your Way Through Disaster Recovery.

Repeat the Test

If there were major failures during the test, take time to revise the plan to reflect those problems and then schedule another test to verify the corrections. If the recovery process mostly worked as planned, you can wait until your next regularly scheduled test—usually annually, though some prefer twice annually or even quarterly—to test the update.

CCS Technology group offers disaster recovery planning services. Disaster recovery testing is an important part of your business continuity strategy. Contact CCS Technology Group to learn more about writing and testing your DR plan.

Digital Transform in the Distribution Industry and How Cloud ERP Can Help

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Discussions about digital transformation often lead off with the phrase, “Just imagine if…” Just image that you could use Internet of Things (IoT) sensors to build a new kind of relationship with customers. Just imagine that you could track an order from receipt through delivery in real time. For a lot of companies, it’s pie in the sky. In distribution, the pie has already been served. You just have to order a slice. You don’t have to “just imagine” a digital transformation if you have the right tools.

Digital Transformation, the Concept

What is digital transformation? Briefly, digital transformation is a concept that started out in life as marketing hype but is quickly becoming reality. At its core, digital transformation involves using advances in application integration technology, cloud computing, data analytics and “edge computing” IoT devices to transform your relationship with customers, employees and partners. It enables you to venture into new business models and competitive strategies.

Digital Transformation in Distribution

The distribution business was actually an innovator in the practices that now comprise digital transformation. Distributors adopted computer-based order tracking, inventory management and the like years before anyone else. You may not remember, but before about 1990, if you shipped a package, you had a 0% chance of knowing when it was going to be delivered. You could call the carrier and ask, but they didn’t know.

Today, instant online or phone-based order tracking, along with dozens of comparable real-time processes, are simply an expectation of doing business. The problem with this is that once business practices become a given, they are no longer competitive. If every distribution company offers online order tracking, your distribution business is another dime, among dozens. Learn more in Looking at 2020 Distribution Industry Trends with ERP in Mind.

The challenge—and opportunity—for distribution companies is to use technology to take the business to new levels of efficiency and competitiveness. This is not always easy, but the tooling is definitely available to make it happen if you want it. With cloud ERP solutions like Acumatica, distributors can implement a range of digitally transformative processes and practices in their businesses. These include:

  • Maintaining a real-time view of your customer’s activities across all your operations. This is made possible by integrating field service operations software with back office systems.
  • Tracking customer engagement from first contact through opportunity creation, price quoting order processing, scheduling of installation and follow up field services—connecting mobile devices with ERP and accounting software as well as with data analytics and reporting tools.
  • Using data visualization to spot issues in field service quality—and react in real time with route optimization
  • Leveraging Artificial Intelligence (AI) for predictive maintenance that optimizes field service and keeps customers happy
  • Discovering the optimal marketing processes to identify and convert the best prospects into high-grossing accounts—by analyzing account performance data with marketing campaigns
  • Increasing back office productivity by automating workflows and becoming more efficient at document management, e.g. for contracts and sales orders
  • Integrating with partner firms for better supply chain management and customer service

Acumatica Distribution Edition delivers, giving your business control over their supply chain and logistics activities, including warehouse management, inventory management, and order management. Built in the cloud and customized for your needs, Acumatica helps companies improve customer satisfaction, reduce order times, and control costs across the entire supply and distribution chain.

CCS Technology has considerable experience in the distribution vertical, equipping clients with industry-specific tools that ensure a smooth process, top-notch security, and consistent reliability. We’ll make sure your clients can count on you. Contact us to learn more.

Additional Distribution Resources

Benefits of ERP Software for Distribution Business Management

Making the Most of KPIs in Distribution

5 Reasons Distributors Need ERP Software

Choose the Right IT Service Type to Best Meet Your Business Needs

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IT services come in several different forms. If the service type you choose doesn’t match your requirements, you won’t get the benefits you expect and will likely be disappointed by your experience. Make sure you know what different IT services offer so the one you select is a good fit for your business.

1. Break-fix

Break fix services provide support to fix problems after they occur. When hardware breaks or software fails, you can call the break-fix company to investigate and resolve the problem. This approach is entirely reactive and doesn’t look beyond the immediate problem.

2. Contractor

A contractor is effectively an addition to your staff without adding a permanent employee. Through the contracting agency, you’ll select someone with the appropriate skillset for the job. They then work under your direction on whatever assignment you give to them. While contractors are sometimes called consultants, a contractor’s services are less independent than true consulting.

3. Consulting Services

Consultants are brought in to solve specific problems. Unlike contractors, consultants are expected to think independently to develop solutions to larger problems. The scope of the consulting work is up to you. Generally, you provide the consultants a statement of the problem; they investigate to determine the requirements, propose a solution, and complete the project implementation.

4. Outsourcing

When you outsource your IT to a provider, you hand over control of your IT resources to the outsourcing firm. They handle all the ongoing support. Unless you request a project to expand or upgrade your IT technology, the focus is on maintaining your current infrastructure.

5. Managed Services

With managed services, as with outsourcing, you rely on a provider and their staff to provide you with IT services including monitoring and support. However, unlike outsourcing, the managed services provider looks towards your future needs. Outsourcing is “outside” of your business. Managed services providers are partners with your business and take ownership of resource-related issues, including making sure the infrastructure will support your business as it changes. They can recommend and implement the infrastructure you will need tomorrow, not just support the infrastructure you need today.

Learn more about the benefits of partnering with a managed services provider.

Be clear: none of these services is better than any other, but one might be a better fit to your business. It entirely depends on what your IT challenges are, the level of IT expertise you have in-house, and how much control of your IT resources you’re willing to turn over to a third-party. Contact CCS Technology Group to discuss how our IT services match your business and IT needs.

Interested in learning more? Find out the benefits of working with IT pros.

Balance Risks and Rewards When Making the Cloud Decision

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Deciding to invest in cloud technology, like making any IT investment, requires balancing the risks against the rewards. This scale will tilt differently for every business depending on its internal priorities and the challenges of its internal IT. How do these numbers stack up for you?

Assessing the Cloud Risk Balance

There are a number of cloud risks you should consider, along with ways they can potentially be mitigated.

Risk: Security

For many businesses, the security of cloud remains a major concern. With data in a shared environment that isn’t completely under your control, there are new threats to data security.

Balance:

There are threats to data security within your own data center. Many businesses lack security expertise on staff, and they are behind on basic security measures such as patch installation. In the cloud, you have the benefit of the cloud provider’s security team, and they handle much routine support and maintenance.

Mitigate:

You can mitigate data security risks in the cloud by taking advantage of tools that help ensure a secure environment and authorized access to data. Many cloud providers have documented best practices and can analyze where your configurations don’t follow those suggestions. You can often implement your own security measures with firewalls, cloud access security brokers, and encryption. Learn more in 6 Ways to Keep Your Cloud Secure.

Risk: Over-spending

Although cloud can be lower-cost than on premises infrastructure, it’s easy to spend more than expected. These unexpected expenses can come from higher demand than anticipated or through self-service, on-demand instantiation of new, unapproved services.

Balance:

Although cloud spending figures can be substantial, they are generally nowhere near the scale of the capital expenditures associated with on premises infrastructure. In addition, on-demand cloud access gives you greater flexibility and agility than if you have to provision needed resources in your own data center.

Mitigate:

Use tools to help you track changes in your cloud configuration so you can identify new instances and new services. Track utilization numbers and look for opportunities to consolidate. Automate money-saving policies such as shutting servers down at end of day. Learn more in 9 Ways to Get Cloud Costs Under Control.

Risk: Lack of control

Managing cloud resources is complex because there’s a loss of visibility, especially if you use multiple clouds. Until your team develops expertise in the cloud systems, you’ll also find management challenging simply due to lack of experience.

Balance:

Controlling systems in your own data center is challenging, as well. And because the cloud provider handles many of the routine maintenance functions, you’ll have more time to devote to analyzing the data you access.

Mitigate:

Use managed cloud services from CCS Technology Group to add expertise to your team. Our experts can help you select the right cloud, migrate your infrastructure, and provide the support needed to make sure your cloud continues to meet your business needs.

Those are just a few of the risk tradeoffs you’ll want to consider when you’re deciding whether to switch to cloud. Contact CCS Technology Group to learn about other risks and rewards to evaluate and to get help successfully switching to cloud.

5 Benefits of Better Collaboration for Businesses

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Who doesn’t want better collaboration? It’s the corporate version of Mom and Apple Pie. Yet, for all of its attractiveness, collaboration has turned out to be harder to achieve than people expect. There are many reasons for this, including cultural obstacles that prevent people from wanting to work together, e.g. in a hyper competitive work environment, people tend to help themselves, not others. Learn more in 5 Risks of Poor Collaboration in the Workplace.

Assuming the will to collaborate is present, the technology has to be available to make it happen. This, too, has proven difficult, though today the corporate world can choose from a rich array of sophisticated collaboration tools. Microsoft Teams, for instance, is powerful because it accommodates different personal work styles while integrating with the universal “productivity infrastructure” of the Microsoft Office system.

If you’re contemplating a program to stimulate better productivity, here are five benefit you’ll realize in the process:

1) Higher profits

Companies that don’t foster strong collaboration experience a host of hidden costs as a result. These may arise from invisible but expensive problems like people sending multiple emails and making phone calls to get a single task accomplished. Every person/minute in your business costs you something. The more time people waste in non-collaborative processes, the higher your costs will be. Collaboration drives productivity, which drives profits.

2) Stronger growth potential

Collaborative organizations move faster than those without. This enables them to take on more work and facilitate revenue growth. A good collaboration culture, backed by the right technologies, can also adapt to new modes of business—enabling agility and strategic advantage.

3) Improved morale and organizational cohesion

People who don’t like their jobs make their feelings known in ways that can be hard to see, but are nonetheless toxic to an effective organization, e.g. passive aggressive slowdowns, counter-productive perfectionism and so forth. This phenomenon can range from simple frustrations about getting work done to outright battles between people who can’t find ways to work together. Collaboration technology will not solve all of these problems, of course, but it can create a digital workspace where people can find ways to cooperate without cramping their individual styles. The results include better moral and organizational cohesion.

4) Better recruitment results

Prospective employees, particularly those from the newer generation entering the workforce, want to work in positive, collaborative environments. This is a digital native generation that is accustomed to mobile chat apps, social networks and the like. The office should be an extension of that experience.

5) Better talent retention

Once hired, people tend to stay in places where they like the work experience. This may seem obvious, but so many companies fail to connect the dots—proclaiming the value of collaboration but failing to deliver it, in tech terms. For some employees, this may be the factor that drives them out the door. A costly, productivity-sapping recruitment process arises as a result.

Learn more in Improving Collaboration With Microsoft Teams.

Interested in Microsoft Teams? Achieve Ultimate Collaboration in Just 2-3 Weeks

Get a head start with the Teams Quick Start Program from CCS Technology. We can get you up and running on the Microsoft Teams platform in 2-3 weeks so you can transform productivity and translate into more effective meetings, greater revenues, and profits. Click here to learn more.

The Importance of Project Cost Management

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Project-based businesses need more than basic accounting. The income statement has a section for revenue and a section for costs. This is great for preparing the tax return or reporting to shareholders. If you want to know how much you’re making or losing on projects, you won’t find it in the income statement. You’ll need specialized project accounting software.

Acumatica Cloud ERP can help. It includes Project Accounting Software that integrates with General Ledger, Accounts Payable, Accounts Receivable, Sales Order Management and other business management modules. Project accounting management enables project cost tracking (covering materials, services, labor and inventory items), budget reporting and billing based on specific project, task progress or completion percentage. Users can compare project costs with original and revised budgets while considering all project costs.

Project accounting figured prominently in Acumatica:

  • Split the budget into Revenue Budget, which can be defined by task or task and item, and Cost Budget, which can be linked to a revenue budget line to enable more flexible analyses of project balances and profitability.
  • View and track budget commitments for large projects lasting longer than a couple of weeks. With this functionality, you can monitor potential cost overruns, connected purchase orders, negotiated rates and other information from one location.
  • Bill for time, material and fixed price and manage the billing workflow without configuring the allocator, which makes it easier to bill for simple projects. Users outside the accounting department can review and edit invoices.

Relevant Project Accounting Applications in Acumatica 2019 R2

Acumatica 2019 R2 carries forward a full set of project accounting features. It incorporates useful applications to help businesses analyze and monitor the cost of projects, including:

  • Project Cost Accounting: View all project-related costs and use formulas to allocate shared costs and overhead expenses to specific projects. This is a benefit for marketing, construction, engineering and other project-based businesses.
  • Advanced Billing: Cost plus, fixed price, contract-specific pricing, milestone and time and materials billing can be managed. Resource billing rates can be modified as needed and labor and materials can be billed based on the type of work, the customer or project contract.
  • Time and Expense Management: Timesheets can be entered by employees, contractors and partners from any device or web browser. This improves accuracy and adds convenience to the Project Accounting Software.

Other Benefits of Project Cost Management

Cost tracking, budget reporting and flexible, accurate billing are just a few advantages of using Acumatica for project accounting. Other beneficial functions include:

  • Change Order Control: Make changes to the scope of a project, using all relevant documentation such as revenue/cost budget, class and commitments while defining workflows and approval processes. Audit trails and full visibility ease the release of change orders.
  • Project Quote Management: Improved control and management help simplify project sales and pricing while Acumatica provides support for more complex quote processes. Quotes can be created, updated and linked to CRM within the system.
  • Company-Specific Financial Periods: For organizations that have different fiscal year-end dates, financial periods can be defined at the branch level, especially if related business entities share vendors, employees and stock items.

Acumatica also supports multi-currency project accounting. Project managers and accountants can see actual revenues and costs and calculate profitability using the project currency, while customers can see costs in their native currency. With revenue recognition, billing rules can be defined to identify revenue from completed tasks or a percentage of project completion.

To learn more about Acumatica Project Accounting, contact us for a free product tour or software demo.

Additional Resources

How ERP Software Solves Your Business’s Top Financial Management Challenges

5 Benefits of ERP for Accounting and Financial Management

The Value of Implementing an ERP for Professional Service Organizations