Review: New project costing features in version 11 of Line 50. By David Carterby
David Carter finds much to admire in the new Project Costing features in Sage Line 50 v11. But the nation's top accounts package still doesn't have a proper screen for entering purchase invoices.
When Sage announced version 11 of Line 50 last year, some project costing features were announced for "users who wanted to dip a toe in the water and analyse job and project information at a very simple level without having to go into complexity'.
This turns out to be a bit of an understatement. Talking to Sage at Softworld last week, I think it's fairly clear that in the long term their strategy is to pension off the existing Job Costing package and incorporate fully fledged project costing within Line 50.
The demise of Sage Job Costing will go unlamented among AccountingWEB readers who have been pretty scathing about it on Any Answers. Below are some introductory notes on Sage's 'toe in the water' project costing features, which are currently available in version 11 of Line 50 (Accountant Plus and Financial Controller only).
To activate the Project Costing module, first make sure it is ticked in Company Settings. Then go into the Configuration Editor to set it up.
You can define your own cost analysis codes. Sage comes with four defaults already set up - Labour, Materials, Overheads, Mixed.
You can also define your own Job Stages. Default project statuses set up are: Active, Snag, Completed, Suspended, Initial (ie quoted, not yet ordered)
You can also attach your own names to three Project Custom Fields can be attached to each job. These will be useful in reports analysing income and profitability. So you might set these up as "Project Manager", "Job Type", "Locality" and so on.
Setting Up a New Project
The Project'New screen confirms that this is a fully fledged Project Costing product. There are four screens' worth of data about each job.
In the Details screen you type in the Budget Cost and Quoted Price for the job. Also the Job Status, and Start and End Dates. (It would be nice to also have a Revised End Date for jobs that go over schedule.) And here you attach your three Project Custom Fields for reporting.
The second Analysis screen shows you accumulated costs and revenues to date versus budget, variances to date etc. The third Activity screen lists the individual transactions analysed to this project. The fourth Memo screen allows you to cross-reference to any correspondence or estimates produced in Word or Excel.
According to the Help screen, Project Costing begins "at the moment in the project cycle when your customer has accepted the quotation or estimate you gave them and placed an order." So there's no Estimating here. Fair enough.
I set up a new Project and tried putting through some postings.
Purchase invoices, credits, bank payments, stock
When entering purchase invoices (PI), purchase credits (PC) bank payments (BP), and stock adjustments (AO) you can now analyse to a Nominal Code and a Project simultaneously. In addition to the existing N/C and Dept boxes, there are now boxes for Project and Cost Code, making four dimensions of analysis. This is great and just as it should be ' a quantum leap for Line 50.
However, apart from PI, PC, BP, and AO's there are no Project and Cost Code boxes in any of the other transaction entry screens. This worried me initially ' in particular, quite a few job transactions also appear in Nominal Journals and Purchase Orders.
However, you can probably get round this by using the Project Charges option. This new CC transaction type is a Project Only Cost only - it updates only the project ledger and doesn't affect the nominal ledger or the stock history. You can use this to post timesheets, make adjustments and corrections (for example cost allocated to wrong job), and allocate service items which would not be analysed to the nominal ledger anyway.
I tried using Project Charges to post timesheets. Initially you set up the employee as a Resource, together with their Unit of Measure and Charge Out Rate.It's a bit basic (30 minutes has to be entered as 0.50 hours), but seems to work OK. But shouldn't there be two rates, a Charge Out rate for billing and a Cost rate for budgeting?
Sales and Purchase Orders
If you want to set up a project when entering a sales order you call up a special product code S3. A box appears asking you to define the project details.
Ominously, purchase orders are not mentioned at all in the Help screens for Project Costing. Purchase Order Processing in Line 50 is resolutely stock-based. As far as I can see, the only way to analyse purchase orders to jobs would be to create a non-stock product for each job, then map the product record to the Project code. Sage does this already for Nominal Codes and Departments but they haven't extended it Projects. If you want to analyse project costs in your purchase orders, I don't think Line 50 is for you.
There is no project billing feature in version 11. As with sales order processing, you can call up the S3 product code when entering the invoice and analyse the costs to the project there.
To be honest, I'm glad that Sage does not include Billing in Project Costing. It's seems to me that Job Costing packages often go wrong because the developers start defining Project Costs as the value of costs recharged in sales invoices. This is the way it is in QuickBooks.
Sage Job Costing has the same problem. As AccountingWEB member Tom Cadogan noted: "No meaningful reports for WIP when jobs are billed on a fixed-price basis. Reports only work when you bill on a cost-plus basis, or time and materials, and each invoice is therefore allocated against specific purchased items, leaving the unallocated costs as WIP..........Logic is fine, but all my jobs are fixed price."
Viewing the Results
I know that in transaction entry there do seem to be a few bodges here and there with S3 codes etc, and I think that for transactions like Nominal Journals you may have to make two separate entries ' a Journal to update the Nominal Ledger, and a Project Charge to update the Project Ledger.
But no matter, I posted a purchase invoice, a purchase credit, a timesheet and a stock issue. And then I opened up the Project Activity screen. Lo and behold - all four were displayed one below the other!
This is the most important single test in my view ' all the costs from whatever source are collected together and listed on one screen. None of this nonsense about showing only those costs that have been recharged through invoicing, like QuickBooks.
Of course, there's always something to complain about with Sage. The Activity screen doesn't tell you who the supplier is. You can't drill down to see more detail. I tried File'Send To Excel with the Project Activity scree, but it just exports the same fields. I then tried going into the Financials screen and exporting transactions from there, but there's nothing about projects here.
Sage offer 28 Project Costing reports. The Project Activity Report and Project Audit Trail report are both good and contain all the detailed data you want. They can also be exported to Excel via Save As, file type = csv.
One striking omission is that there's no mention of a report calculating Work in Progress valuation for month-end. Nor is WIP mentioned in the Help screens. I'd hoped to be able to print out the Cost Summary Reports for all jobs whose Status is Not Complete, but this isn't possible as the reports only select on Project Reference, not status.
Wanted ' a new Supplier Invoice Entry screen
To summarise, then, Line 50 Project Costing has a few clunky bits in transaction entry. But on the key job of pulling together into one place all the costs for one job from whatever source, it performs well and can be recommended.
However, these new Project Costing features simply emphasise even more an astonishing fact ' the nation's top accounting package doesn't have a proper screen for entering purchase invoices.
In Sage you enter purchase invoices via the Batch Supplier Invoices screen. This is a relic from the early days when accountants used it to bang in dozens of invoices out of a shoe box. Only the most basic analysis is needed for the financial accounts, so a single line for each invoice with minimal narrative and a single N/C field was enough.
If in Sage you want to analyse a purchase invoice over two departments, you have to enter a second 'invoice'. With the new Project Costing feature now allowing you to analyse invoices over four different dimensions, the more you analyse the detail of each invoice, the more new 'invoices' you will have to enter with some sort of manual apportionment of VAT. Extraordinary.
In a sub-£99 package like Instant Accounting this sort of design may be OK. But with Financial Controller now priced at £995 and offering sophisticated project analysis over four dimensions, this shortcoming is unacceptable.