Project accounting is an essential aspect of business operations, and we suggest outsourcing the project accounting services instead of asking your project manager to conduct these services.
Based on the size of the project or your organization, it may be more beneficial to allow us to monitor the project, track variances, and approve expenses.
Ensuring that project billing is done correctly, delivered to clients on time, and payments are received on time are aspects of our project accounting services.
We take care of project reporting and maintenance of relevant income and expenditure, and we oversee project records and contracts to ensure that they are being followed.
Our team of auditors maintains and manages accounts and review processes for the same. We ensure the development of a user-friendly financial system while working alongside your IT team.
Online Project Accounting Services
Especia's online project accounting services USA ensures you stick to your project budget by tracking costs and managing project finances.
Management of elements related to financial transactions in a project refers to project accounting.
Project costs, revenue, and billing are included in this process. Our online project accounting services can help you execute financial tasks on projects.
We also regularly send reports on the project's progress and our progress with project accounting to your management team.
Especia maintains project budgets and helps your project managers stay updated about overhead costs, revenue, and the project’s direct costs.
Our team helps your team make necessary adjustments to curb overspending and ensure that the financial transactions made adhere to the budget.
We start our process by working with your team to create a project accounting plan during the project planning phase.
Our project accounting services plan contains an outline of costs and schedules for monitoring and tracking costs. This improves project execution and allocates money spent efficiently on resources, equipment, project team, etc.
Our team of professionals uses project management tools during the project planning process to organize the costs of delivering a product or a service on time while staying within the budget.
We use tools that help our team plan and manage costs and resources related to the project to ensure efficient allocation.
Our Services for Project Accounting Services USA
Especia provides financial and project accounting services, and knowing the difference between our services is crucial.
We use separate timelines for project accounting and financial accounting. Our project accounting services are limited to the project, which has a start date and an end date; our job ends when the project is completed.
On the other hand, our financial accounting services function throughout the year according to your business needs.
Another key difference is that the reports we make for each of the services are different.
For project accounting services, we form reports based on deliverables, while financial accounting reports focus on other aspects of the business.
Financial accounting services are involved with profit and loss as a whole, not just through a project.
Another key difference is diverging cost hierarchies; when it comes to project accounting, the cost hierarchies focus on tasks and projects.
On the contrary, cost hierarchies for financial accounting focus on cost centres and departments.
The levels of understanding of the two types of accounting services we offer are also different.
Comparative analyses are conducted for financial accounting more than project accounting.
Another key difference is the involvement of stakeholders. In project accounting, stakeholders are not involved in the planning process, but they play a key role in financial accounting.
What Does the Project Accounting Process Look Like at Especia?
At Especia, the project accounting process is begun by creating a detailed plan of project costs.
After that, they are managed by our team during project execution to make sure we stay within budget. To make this happen, we monitor project costs and track the variance between actual and planned costs.
We document and record the project costs incurred throughout the project in an error-free fashion.
Not only do we help you stay within the planned budget, but we also help you predict future costs of contracted delivery schedules and completion dates.
We focus on predictions without neglecting the comparison between actual expenses and revenue to the planned costs.
Another aspect that we consider important for documentation is the date legal agreements are signed with the client. We track earned revenues from sales agreements and predict costs for each project phase.
To conclude, our work is to follow where the money from the project plan is going during execution. We help your team stick to the budget through detailed documentation and adjustments.
Especia’s Principles for Project Accounting Services USA
We have a standardized system in place for the project accounting process, and we use certain principles to maintain these processes.
These principles help our team at Especia plan, initiate, and establish metrics for project accounting.
We execute contracts, avoid scope creep, and close out projects using our eight principles mentioned below.
- Cost Principle: Our team strives to capture the actual cost incurred instead of the potential cost by using the original value instead of the forecasted market value.
- Matching Principle: Especia ensures that revenues and expenses match appropriate costs during the duration of the project. While recording and assigning expenses, we make sure to include them in the period the expenses were incurred.
- Consolidation Principle: Especia strives to ensure that overall project cost is consistent through our systematic process of determining costs and revenue. We use a singular account to consolidate financial activities for a project.
- Whole Disclosure Principle: recording every significant transaction in the financial statement for transparency is crucial. This may be a difficult task to delegate to an inexperienced worker or the project manager. Hence, reach out to us at Especia to gain clarity with your stakeholders.
- Prudence Principle: We use the best estimate of the revenue and expenses closest to the actual costs and revenue.
- Liability Principle: We keep a record of predictions of future costs and obligations to help prepare your team for costs. This may include contract penalties, liquidation damages, and so on.
- Control Principle: Our team focuses on ensuring that regulations are followed through procedures entailing close monitoring of financial activities. We keep track of to report all costs to your management team so that non-recurring events can be adjusted according to the budget.
- Resource Allocation Principle: Our team at Especia makes sure that resources can be allocated across projects.
Role of Revenue Recognition in Project Accounting Services
Revenue recognition is an important benefit and aspect of project accounting services and is based on payment from a client. This
payment can be made before, during, or after the project is completed, and once the payment is received, the revenue is recorded. Here are a few revenue recognition methods used by Especia.
- Sales Basis
Under this method, revenue is only recognized by Especia once the sale is made. Revenue is only recognized or recorded once a purchase is made either in cash or credit upon the delivery of goods and services. This may seem applicable only to retailers but also to project deliverables.
Under this method, payments are made over time and involve a risk of whether a payment will be made on time. Our team at Especia uses this method to track revenue and recognize it as a portion or total revenue earned throughout the project.
- Complete Percentage
This is the method used by Especia’s professionals for long-term or large projects. We track and record revenue in the form of milestones that indicate progress in the project. The contracts made for projects needing this method are detailed, allowing us to know when to recognize revenue instead of waiting till the end of the project.
- Completed Contract
In this method, Especia records revenue once the project has been delivered to stakeholders and clients, and your team gains their satisfaction. Especia primarily uses this method for extended warranty periods or short-term projects. A mistake that an inexperienced worker can make is using the complete percentage technique when the completed contract is required. Especia's professionals ensure that this does not happen.
- Cost Recoverability
If your project is such that the cost of goods and services cannot be estimated in the contract, we use the cost recoverability method. Especia uses this conservative revenue recognition method only after the project costs have been recoupled.
Benefits of Especia’s Project Accounting Services
Beyond revenue recognition, there are many benefits to outsourcing project accounting services USA.
A third of the triple constraint is cost, and the key to delivering a successful project is the management of finances.
We at Especia track the cash flow to keep tabs on how much money is being spent and help your workers stay within budget. Here are some ways in which Especia's services can be beneficial to your project.
- Deep insight into cost, bids, and scope for a new project
- Resource management is improved
- Regular updates on project progress and profitability
- Identification of issues
- Quick responses
- Making the project team aware of project cost and profitability
- The financial management of the company is improved
- Reduction in risks
- Overall, project management is improved
Why Choose Especia for Outsourced Project Accounting Services USA?
Apart from some basic benefits of project accounting services, two things make Especia stand out from other firms.
We use dedicated software tools to capture real-time data and help your project team's decision-making process.
Our team of professionals organizes costs and resources while monitoring them in real time for better budget management and successful delivery to stakeholders.
- Streamlining of Payment and Time Tracking
Especia uses software to create timesheets for efficient management of resources, and once we create our timesheets, we will send them to your project manager for approval. We also track what each project team member is working on, the outstanding tasks, and the overall workload. Our reports will help you make better decisions on what work to allocate to whom based on where each member of the team stands with work progress. Especia helps you with capacity planning and expense planning.
- High-Level View of Costs
Especia's professionals work at the same pace as your project team. We capture and calculate project data and display them in the form of charts and colourful graphs that are easy to understand. We help you track costs in real-time and create timesheets, cost reports, and more. Especia's team also ensures that your stakeholders are updated on the status of the project.
Especia's team of professionals are experts at organizing tasks, resources, creating cost management plans, and more.
We track your budget in real time after setting it while creating and presenting detailed reports to help you stay on schedule and within the budget, and we are waiting to hear from you. Reach out to us at Especia for the best outsourced project accounting services USA.