Most builders and trade contractors know roughly how a job is tracking. Far fewer know exactly, until the job is finished and someone sits down with the timesheets, supplier invoices and variations to work it out. By then it's too late to do anything about a job that's running over.
The problem usually isn't the accounting software. It's that labour, materials and variations reach it late, in the wrong place or not at all. This article focuses on one thing: getting costs into the right job, automatically, so your job costing is current.
The short answer
Job costing works when every cost carries a job reference from the moment it's created. Timesheets, purchase orders, supplier bills and variations should all be linked to a job before they reach your accounts. Automation can take care of the matching and posting, and flag anything that doesn't match for someone to review.
Why job costing falls behind
The same few issues come up again and again:
- Timesheets arrive late or without job codes. Hours are recorded on paper or in an app, then allocated to jobs at the end of the week from memory.
- Supplier bills don't reference the job. Invoices arrive with a PO number, a site address or nothing at all, and someone has to work out which job they belong to.
- Variations live in emails and texts. Approved changes aren't recorded consistently, so they're missed in both costing and invoicing.
- Materials are bought on the run. Trade counter purchases and card payments aren't allocated to jobs until much later.
- Several systems, no single job view. The job management tool, accounting software and spreadsheets each hold part of the picture.
The cost categories that matter
For most construction and trade businesses, job costs fall into four groups:
- Labour. Employee hours at the right cost rate, plus subcontractor charges.
- Materials. Supplier bills, trade counter purchases and stock used on the job.
- Plant and equipment. Hire charges and internal equipment costs.
- Variations. Approved changes to scope, with their cost and the price to the client.
Each one needs a reliable route into the right job.
Workflows worth automating
These are typical patterns, not promises. What's possible depends on the systems you use.
Timesheets to jobs
Staff record time against a job in a timesheet or job management app. Approved hours flow through to job costs and payroll, without someone re-allocating them at the end of the week.
Purchase orders to supplier bills
Every purchase order carries a job number. When the supplier bill arrives, it's matched to the PO and allocated to the job automatically. Bills that don't match, or that don't match the PO amount, go to someone to review.
Variations to costs and invoices
When a variation is approved, it's recorded once, against the job, and flows to both job costs and client invoicing. Nothing relies on someone remembering an email.
A job cost dashboard
Costs to date, committed costs from open POs and approved variations are pulled together against the budget for each job, so you can see which jobs need attention while there's still time to act.
What your accounting software can do
Both Xero and MYOB have job or project features, and both publish APIs that make integration possible.
- Xero. Xero offers project tracking on some plans, and the Xero Projects API covers projects, tasks and time entries.
- MYOB. The MYOB Business API includes a Job endpoint, so job records can be read and used by integrations.
Check which features are included in your plan, and how your bookkeeper or accountant already uses jobs or tracking categories, before designing anything. Many construction businesses also use dedicated job management software, and its own connection to Xero or MYOB may already cover part of this.
Labour costs and payroll
Labour costing and payroll should use the same approved hours. In Australia, employers report payroll information to the ATO through Single Touch Payroll, using STP-enabled software, each payday. An automation shouldn't replace your payroll software. It should make sure the hours that reach payroll are the same approved hours that reach job costs. Check the details with your accountant or payroll provider.
An illustrative example
The following is an illustrative example, not a client result.
A residential builder runs several jobs at once. Supervisors approve weekly timesheets in a mobile app, with each entry tagged to a job. Every purchase order is raised with a job number, and suppliers are asked to quote it on their invoices. When a bill arrives, an automation matches it to the PO, checks the amount and allocates it to the job in the accounting software. Any bill that doesn't match goes to the office manager's review queue. Approved variations are entered once, against the job, and appear in both the cost report and the next progress claim.
The owner opens one dashboard on Monday and sees which jobs are tracking over budget, instead of finding out at the end.
The principle: capture it once, at the source
The same principle drove our work for CorIT Tech, in a different industry. Client onboarding information captured in their CRM now creates the right project records and tasks automatically, instead of staff copying details across. CorIT reported savings of more than 10 hours of admin per month.
For builders, the source is the timesheet, the purchase order and the variation. Capture the job reference there, and everything downstream gets easier.
When automation isn't the answer
Automation won't fix job costing if:
- Jobs aren't set up consistently. If job numbers, cost codes and budgets differ from job to job, standardise them first.
- Teams don't record job references. If supervisors, staff and suppliers don't use job numbers, automation has nothing to match on.
- Your volume is small. If you run a handful of jobs at a time, a disciplined weekly process might be enough.
- Your job management software already does it. Use its built-in costing and accounting connection before building anything.
For a broader look at reducing admin in construction, see how construction businesses can reduce admin with workflow automation.
Frequently asked questions
Do we need new construction software?
Not necessarily. Many businesses get accurate job costing by connecting the tools they already have and tightening how job references are captured.
Can supplier bills be matched to jobs automatically?
Yes, where bills carry a PO or job number that can be matched. Bills without a reference, or that don't match, should go to someone to review.
How should variations be handled?
Record each approved variation once, against the job, with its cost and price. That single record should feed both job costing and client invoicing.
Does this work for trade businesses too?
Yes. The same approach applies to electricians, plumbers and other trades, especially those running multiple jobs with materials and labour to track. See our Trades & Field Services page.
What does it cost?
Custom software and automation projects typically start from A$2,500. Final pricing depends on the systems involved, complexity and scope. For larger projects, such as connecting several systems or building a job cost dashboard, we'd suggest an initial consultation first.
Want to know how your jobs are really tracking?
Tell us how timesheets, supplier bills and variations reach your accounts today. We'll show you where the gaps are and what could be automated. You can read more about our business process automation service and our Construction page.
Get in touch to talk about your job costing.