Level 3: Job planning and job ledger entries

This is what happens in the video

In Business Central project management, the third level of the job hierarchy consists of job planning lines and job ledger entries. Job planning lines represent the expected, meaning your budget and your forecasted sales. Job ledger entries represent the actuals, meaning what you have actually consumed and invoiced. You need both to track how far you are on a project.

Job planning lines come in three types: Budget, Billable, and Both Budget and Billable. Budget lines track expected costs, Billable lines track expected sales, and Both Budget and Billable is used when expected usage and sales are equal, such as in time and material billing.

If you cannot create a sales invoice on a job, the cause is usually that you have only created Budget planning lines. You need Billable planning lines to invoice the customer.

Job ledger entries come in two types: Usage and Sale. Usage entries record your actual consumption of items, resources, and costs. Sale entries record what you have actually invoiced to the customer.

By comparing budget to usage and billable to sale, you can follow up on a project’s progress. This division also lets you calculate work in progress, which is a key reason to use jobs rather than other parts of the system.

Job planning lines and job ledger entries in the job hierarchy

The third level of the job hierarchy is where most people run into trouble. The model itself is not hard to understand once you see the split into job planning lines and job ledger entries. The confusion tends to start when you begin working with the actual entries in the system.

The reason both exist comes down to what this level gives you: details on how far you are on a project. You define what you expect, and you track what actually happens. That requires two separate things. Job planning lines describe the expected. Job ledger entries record the actuals.

What job planning lines describe

For each job task, the planning lines describe the expected consumption of items, resources, and other costs. They tell you which resources should do what work, which items you need, and so on.

The type of planning line also defines whether the planned consumption should be invoiced. You can plan each type of job planning line on resources, items, or directly on a G/L account level. A single job task line, the second level, can have multiple related job planning lines.

The three types of job planning lines: Budget, Billable, and Both

Planning lines can be Budget, Billable, or Both Budget and Billable. Understanding the difference is important.

• Budget lines track what you expect on the consumption side, meaning your costs.
• Billable lines show the expected sales. These are the lines that get invoiced.
• Both Budget and Billable is used when the budget and the billable amounts are equal, for example when you bill time and material.

It is useful to keep Budget and Billable as separate types when you invoice a fixed price to the customer. When you invoice time and material, you can use Both Budget and Billable, so expected usage and sales match one another.

A common problem: customers contact us because they cannot create a sales invoice. When we look at the job, the cause is that they have only created Budget planning lines. You need Billable lines to invoice the customer.

The two types of job ledger entries: Usage and Sale

Job ledger entries show the actuals, meaning what you have realized on the job. They divide into two types:

• Usage is your actual consumption of items, resources, and costs.
• Sale is what you have actually invoiced to the customer.

As with planning lines, there can be several job ledger entries related to each job task. They increase over time as you post with job journals or invoices.

One way to picture this is to put the project in the middle of a model. On the left side you have time registration, purchase invoices, and so on. That is your consumption. On the right side you have sales invoices, which is what you sell and invoice to the customer.

The link between planning lines and job ledger entries

Depending on whether you use the usage link functionality, the direct connection between planning lines and job ledger entries is more or less clear. The usage link lets you decide whether there should be a traceable link between job planning lines and job ledger entries. This is worth setting up deliberately based on how much traceability you need.

Following up on a job using budget and actuals

On the job card, level one, you see the tasks at level two, and the sums pull the numbers from your planning lines and job ledger entries. Here you can see budget total cost and actual total cost side by side.

For example, a budget of 7,460 is based on a range of planning lines planned on different resources, which sum to that amount. The actual cost is based on job ledger entries of the type Usage. If there has been no billing on the job yet, the job ledger entries list shows only Usage entries. Once you create a sales invoice from the job, you will also see entries of the type Sale in that list.

This division into budgets and actuals is what you use to follow up on progress. You compare Billable to Sale to see how far you are with the invoicing. You compare Budget to Usage to see how well your forecast matched reality.

On top of this, you can calculate work in progress, which is the core value of using jobs. You cannot do this in other parts of the system.

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