Tracking the financial progress of a job is an integral part of managing a job in progress. With RedTeam Flex, you can view all financial details, including Estimate, Budget, Actual costs, At Risk, Cost at Complete, etc. in a feature called the Financial Overview. For control and monitoring purposes, you can create and issue Customer and Vendor (subcontractor) invoices, deposits, payables, receivables, and more in RedTeam, where they are automatically organized in the Budget tab and viewable in the Financial Overview. These processes give your business the ultimate toolkit for financial control.
Keep in mind that many processes (Transactions) in RedTeam Flex exist within one or more larger Procedures. You may want to view these more in-depth articles for more context on a specific subject.
1. Manage Schedule of Values for a Proposal
The Schedule of Values can be managed in a Project that is in Request, Proposal, or In Progress status. Often, a Schedule of Values is created during the process of preparing a Proposal for the Customer. Proposals are prepared while a Project is in Request status, which we will focus on in this article.
Later, this Schedule of Values becomes the basis for your Customer Billing (Applications for Payment). It may be modified or updated prior to Billing.
When Importing an SOV from an Estimate, RedTeam Flex will ask you to specify two pieces of information: Import Basis and Allocation Method.
Import Basis allows you to choose how you would like to group the items from your estimate into line items on your SOV: by Cost Code, Cost Division, or Assembly
Allocation Method allows you to choose whether you want two line items broken out for Overhead and Fee (No Allocations), Overhead distributed among line items and one line item broken out for Fee (Allocate Indirect Costs), or no line items broken out and Overhead and Fee distributed among line items (Allocate Indirect Costs and Profit). As long as a customer billing has not been created yet, you can always re-import the SOV if you choose to change the Import Basis or Allocation Method after importing.
Steps:
From the Project's Home menu, under the heading Financial Management, click "Schedule of Values"
OR from the project's Contract tab, click the Manage Icon to the left of the heading and select "Schedule of Values"
Click the Add icon (+)
Select "Add Schedule of Values" to create one line item
Select "Add Schedule of Values Heading" to create headings and group similar items
Select "Import SOV from another Project" to use the same SOV on this Project from another Project
Select "Import SOV from Estimate" to import the line items from your Estimate as the SOV
To Arrange line items and Headings on the SOV, click the more options icon and select "Arrange"
2. Create a Progress Invoice (AIA-style Application for Payment) to the Customer
Customer Invoices (Applications for Payment) can be created once a Project has been promoted to "In Progress" status. Projects "In Progress" are under contract, and as such, may be billed for progress on the job.
The first step to creating a Customer Invoice is to create or update the Schedule of Values for the Project. Schedule of Values are often set up during the "Request" status of a Project, while a Proposal is being put together. Once a Project has been awarded, however, you have the opportunity to modify or update the Schedule of Values before you begin billing.
Steps:
From the Project's Home menu, click "Customer Billing" or navigate to the project's Billing tab
Click the New (+) icon and select "Add Progress Billing" from the dropdown
Fill in the General Information (i.e. Recipient, Period Ending, etc.)
In the Details, fill in the progress against your SOV items by Amounts and Percentages
When finished, click "Next"
In Step 2 taxes may be adjusted or applied by selecting from the drop down list
In step 3, you can create attachments to accompany the Invoice (optional)
Once all files are uploaded, click "Next"
From the Confirmation step, you can View the Invoice to preview and Commit
3. Commit a Customer Invoice
When you have reviewed your Invoice to the Customer and are ready to print or send it, you will want to remove the Draft watermark from the preview by Committing it. If you need to make changes to a Committed Invoice, you must have permission to Uncommit. If you do not see the option to Uncommit, contact your System Administrator or RedTeam Flex Support.
In order to properly calculate progress (percentage and amount) on a Customer Invoice, you may only have one Invoice in Draft status at a time. You will not be able to create a new Invoice if there are Customer Invoices in Draft status. The Draft Invoices must first be Committed.
Steps:
From the Project's Home menu, click "Customer Billing" or navigate to the project's Billing tab
Click the tools icon
Click "Commit" or click "View" to preview the Invoice and Commit from the View
4. View Accounts Receivable Aging
Receivables aging are outstanding monies owed to your company. Customers are typically given payment terms that define the length of time (15 days, 30 days, etc.) a customer has to pay an agreed sum for completed work. Once that time is up, a receivable becomes "aging" according to the length of time the invoice has been outstanding. In addition to helping you manage specific projects, the receivables aging overview lets you monitor how quickly or slowly your company is collecting money, a large factor in the company's overall health and productivity. The Receivables Aging Report is a summary of all aging receivables in the system and can be viewed from the Invoices tab of the Customers Menu. To view receivables aging for a specific customer, you may do so within the Customer's profile. See the "View Customer Receivables Aging" Article.
Steps:
Go to the Customer's Menu and click on the Invoices Tab
Click the View Icon (Computer Monitor)
Select "Receivables Aging"
The report will open in a new browser tab, where it can be viewed, sorted, filtered, and printed
5. View Customer Payments Log
Payments received from Customers are entered into RedTeam Flex against Customer Bills that are created in your In Progress Projects. These Payments are either entered automatically from QuickBooks Online, or entered manually if you are not using the RedTeam and QuickBooks Online Connection.
You can view a log of these Payments from the Customers menu. You can customize this log by using the Filter options to select specific criteria and choose what to display on the log.
Steps:
From the Customers menu, click the Payments tab
Click the View icon
Click "Customer Payments"
To customize the data displayed on the Customer Payments log, use the Filter icon to select criteria, then View the log
6. Add a Vendor Payment from a Vendor Invoice
If you are not using the RedTeam Flex & QuickBooks Online Connection, payments to Vendors will be entered manually once they have been processed in your accounting system.
Payments can be entered from the Vendors menu in the Payments tab or from the Vendor Invoices section of the Buyout tab in a Project.
When Payments are entered in RedTeam Flex (both automatically and manually) the system will create a Vendor Notification document ready to send to your Vendor to notify them of the status of their Payment, as well as inform them of any additional documentation they may need to provide (updated insurance credentials, lien waivers, etc.). This information can be entered in the Instructions section of the Payment (see steps below).
Steps:
From the Project home menu, click "Vendor Invoices"
OR Navigate to the Buyout tab of the project, and use the Manage Icon to select "Manage Vendor Invoices"
Locate and click the tool icon for the Executed (black) Invoice you want to enter a Payment against
Click "Vendor Payment"
Select a Checking Account from the dropdown (if no account exists, contact your system admin for assistance with Configuration)
Enter the rest of the Payment information, such as a Reference (i.e. check or cc number), optional Attachment, Date, and Instructions
Click the checkbox(es) to select the Vendor Invoices you are entering this Payment against then enter the Payment amount
Click "Save"
From the confirmation window, you can Commit the Payment, View the Payment, View and send the Notification, or Close the window
7. Execute a Vendor Invoice
The last step to finalizing an Invoice from a Vendor before issuing the payment is to Execute the Invoice. Executing is typically done by the last user in the approval workflow, often a member of your Accounting team. This user is responsible for reviewing and confirming all the necessary items are in place before making the payment, including the job cost, credentials, lien waivers, and all approvals. Once everything is in place and all necessary approvals have been made, the user can Execute the Invoice.
Once Executed, the Invoice is ready for payment.
Steps:
Review Steps 1 - 4 and verify that all necessary items and documents are in place
Go to Step 5
Review and verify that all necessary approvals have been made
Rate the Vendor's performance and enter any notes in the Approval History feed (optional)
Indicate if this is a Partial or Final Payment in the dropdown
Indicate if you require a Conditional, Unconditional, or no Waiver from the dropdown
Enter a Pay on date, if necessary
Click the checkbox to "Execute this Disbursement Authorization upon Approval"
Click "Approve"
8. Perform an Accounting Export
For RedTeam Flex users who are not currently utilizing the integration features for either QuickBooks Online or Sage, there will be a periodic need to export financial transactions within RedTeam to allow importing them into another accounting software. When each Transaction from RedTeam Flex is exported via an Accounting Export, it will automatically be marked as Posted in RedTeam Flex to prevent exporting the same transaction multiple times. Follow the steps below to perform an accounting export of your RedTeam Flex transactions to your accounting software.
Steps:
Go to the Transactions Menu using the left side menu
Use the Filter Icon to narrow down the list of Transactions you wish to export; be sure to filter out all posted transactions
Click "Filter & Hide" to filter the list and hide the filter options panel
Click the "More" icon and select "Export" to export your filtered list of transactions
An export file will be automatically downloaded to your computer and can now be uploaded into your accounting software system.
9. View All Payables Aging
Payables aging are outstanding monies owed by your company. Typically, a business has payment terms that define the length of time (15 days, 30 days, etc.) you have to pay an agreed sum for materials or services. Once that time is up, a payable becomes "aging" according to the length of time the invoice has been outstanding. In addition to helping you manage specific projects, the payables aging overview lets you monitor how quickly or slowly your company is disbursing money, a large factor in the company's overall health and productivity.
Steps:
Go to the Vendors Menu and click on the Invoices Tab
Click the View Icon (Computer Monitor) & Select the "Payables Aging" Report
The report will open in a separate browser tab where you will be able to view, sort, filter, and print it
10. Delete a Vendor
In RedTeam Flex you can "delete" or remove a Vendor from your active database by making the entity Inactive. Once Inactive, the Vendor will not be available to be selected on Projects or issued any documents in the application. You can always search for the Vendor and change the status back to Active later if necessary.
Steps:
From the Vendors menu, locate and click the Vendor you want to make Inactive
Click "Edit"
Find the Vendor information and uncheck the box to change the status to Inactive
Click "Save"
11. What does each column in the Budget represent?
Understanding the Budget
The project Budget is the foundation of the project cost control process which involves careful integration and synthesis of information from various sources in order to qualify and quantify deviations from such plans expressed in terms of "impacts" to Budget (also referred to as "cost"). The first three columns in the Budget simply display the Cost Code, Cost Category, and Description of each cost code that was initially entered in your Estimate. Once a Project is promoted to "In Progress" status, the values from the Estimate are locked in and displayed in the Estimate column of the Budget (though this will be updated with authorized Change Orders).
Descriptions for each column on the Budget
Estimate - The value for the cost code as it was input on the original Estimate, or increased/decreased based upon authorized changes.
Budget - Initially, the same as the value from the original Estimate; when the project is In Progress it may be adjusted by users who have the "Adjust Budget" option. Users can also take advantage of our "Baseline Budget" feature, which allows you to differentiate if you are updating the Baseline (if the estimate was intended to change upon promotion to in progress) vs a one off Budget adjustment.
Actuals - The actual dollars that have been paid out for this cost code through an approved Invoice, or a timesheet or expense request from an employee. Adjusting Entries from Transactions will also be housed here.
Open - The value of the Open Commitments (Subcontract, PO, or Employee Commitment), minus any Actuals.
At Risk - The amount still left to buy to complete the scope of work for this cost code in full; the projected dollars you anticipate spending to complete the project.
Contingency - Any dollars you want to leave in Contingency for this cost code; if unspent, the amount in the Contingency column will eventually become profit. This is Contractor's Contingency - Owner's would be treated as an independent Cost Code.
Complete - Each cost code's total Cost to Complete; the sum of the Actuals, Open, At Risk, and Contingency columns
(Over) Under - The positive or negative difference between the Budget column and the Complete column
12. Adjust Project Budget
Budget control is arguably the most important factor in any project. Any impacts or changes to the Budget must be factored into the overall projection of the job. Keeping and monitoring the Budget saves you money and a lot of hassle in the long run. The Budget tab in the Projects section of RedTeam gives you tools to help you easily maintain and monitor your project Budget.
Once your Project is "In Progress" you may find that you need to make adjustments to the Budget to move money around to other cost codes or categories, or even to add additional cost codes that were not included in the original Estimate.
The adjustment itself can take place as either a standard adjustment, or an adjustment to your project’s Baseline. The Baseline method is accessed from the grey plus button, while the standard adjustment is accessed by clicking on the cost code’s budget amount you wish to adjust.
When adjusting the Baseline, you will be taken to a different view of the budget, and can simply click into the desired budget’s line and update accordingly. You can only change the Baseline amount, not the adjustment section of the screen.
When making a standard adjustment, you can first confirm the cost code, scope, and cost category of this change. You will also be given the choice between increasing/decreasing the line by the entered amount, or changing the budget to the entered amount. A note will be required for any change, as well as the optional ability to tie this to an open issue
You will need permissions to be able to adjust the Budget. If you do not have the option to adjust, please contact your System Administrator or RedTeam Service through the Help Center for assistance.
Admins: to add the permission for a user, go to the Configuration menu > Roles & Permissions > click the tools icon for the Role > Open > search for: UpdateBudget
Steps:
From the Project's Home menu, click "Budget"
FOR STANDARD ADJUSTMENTS
Select the Budget line you would like to adjust, and click into it.
You can choose to either "Increase or Decrease" budget to, or "Adjust Budget to This Amount".
Be sure to save your work.
Or
FOR BASELINE ADJUSTMENT
Navigate to the "+" button in the Budget, and select "Mass Update Baseline Budget".
You can then adjust the Baseline as needed by clicking into the respective column.
Be sure to hit the "Enter" key to save your work.
13. Adjust Budget Contingency
Budget control is arguably the most important factor in any project. Any impacts or changes to the Budget must be factored into the overall projection of the job. Keeping and monitoring the Budget saves you money and a lot of hassle in the long run. The Budget tab in the Projects menu of RedTeam Flex gives you tools to help you easily maintain and monitor your project Budget. Cost contingency is a crucial aspect of cost estimation that measures risk in a project. In the Budget, it is a method of expecting and planning for these uncertain costs. With appropriate permissions and once the Project has been placed in InProgress status, you may alter, or adjust, the Project Budget Contingency line item right from the Budget tab.
Steps:
From the (In Progress) Project home menu, click "Budget"
Click the contingency item that you wish to edit from the contingency column of the Budget
Select the appropriate project scope and manually edit the contingency amounts as necessary for each cost category
Click "Save" when done editing
14. Add Cost Codes to Budget
Often, the Budget is automatically generated based on your Estimate and the Assembly Items in it. For more information on creating a Estimate and adding Items, see "Manage Project Estimate" article.
If you did not enter an original Estimate (for instance, if you chose the option to Skip the Preconstruction and Proposal Processes), you have the option to add Cost Codes to the Budget once the Project is "In Progress."
You might also follow this process to add Cost Codes to the Budget that were not included in the original Estimate.
Steps:
Click on the New (+) icon and select Add Cost Code from the dropdown
Select one or more Cost Codes from the list
Click "Save"