🔓 Required permissions:
Team: Super admin
Project: None
Reading time | 5 min |
Setup length | 10 min |
Steps | 7 |
I/ Overhead costs : What are they ?
On the platform, overhead costs refer to all the fixed expenses of your agency. You can enter and view these costs in the "Costs" tab, then click on "Overhead."
These also include all expenses outside of projects, such as unlogged hours, hours logged outside of projects, expenses not related to projects, and invoices for non-project costs.
💡Good to know: an expense that concerns a single project (a contractor invoice, an expense report) should be linked to that project. It then counts as a direct cost of the project. If it is not linked to any project, it goes into overhead and is spread across all your projects.
II/ Key elements to enter
To allocate your overhead costs to your projects based on actuals, you need to :
Have entered overhead costs (under the "Realized" tab),
Have entered hours worked by team members on projects,
Have entered salaries.
You can find this information in the "Finances" tab > "Income" > "Realized."
How are monthly amounts entered?
In Costs > Overhead, the Budgeted tab holds your forecast. You enter an annual amount for each category, and the platform spreads it over the 12 months.
Every new month, the budgeted amount is copied into the Actuals tab for the previous month. If the real expense is different, correct that month in Actuals.
Example: your annual insurance is paid in one go in January. To reflect reality, enter the full amount in January in Actuals, and update the other months.
Tip: to prepare next year, go to Budgeted > Actions > Copy Previous Year. This year's actuals become next year's budget, which you can then adjust.
To budget your overhead costs on your projects, you need to :
Have entered overhead costs (under the "Projected" tab),
Have entered a budget or a resources schedule for the project (define whether you want to base it on one or the other in Settings > Modules > Costs),
Have entered salaries.
You can find this information in the "Finances" tab > "Income" > "Projected."
III/ Allocation of overhead costs
On each project, your overhead costs can be allocated in two ways:
Based on loaded cost:
The higher the hourly loaded salary of a team member, the greater their share of time entry on the project, and therefore, the higher the share of overhead costs allocated to the project.Based on hours entered:
The more hours entered on the project, the higher the share of overhead costs allocated to the project.
To choose the method, go to Settings > Modules > Costs, under Overhead calculation method, then select By cost paid (loaded cost) or By time spent.
Example: two projects each receive 10 hours, one from an intern, the other from a partner.
By time spent, both projects receive the same share of overhead.
By loaded cost, the partner's project receives more, because their hourly loaded salary is higher.
Which one should you choose?
By time spent: easy to explain to your teams. A good fit if salaries in your agency are similar.
By loaded cost: closer to the real cost of each project. A good fit if salary gaps are large (partners, employees, interns).
To learn more about how overhead costs are allocated to your projects using these two methods, click here.
Frequently asked questions
How can I see my project's margin with or without overhead?
Open the project, then the Finance tab. Toggle overhead on to see the project's net margin, or off to see its gross margin.
The overhead amount on my project looks wrong. What should I check?
Check that your team members' hours are logged on the project. Hours logged outside projects go into overhead.
Check that the project's invoices and expense reports are linked to it.
Check that your team members' salaries are entered.
Check the amounts for the month in Costs > Overhead, Actuals tab.
Check the method selected in Settings > Modules > Costs.
If the gap remains, contact us through the chat bubble.
How do I enter a refund or an adjustment?
Add a line to your overhead with a negative amount. For example: social security benefits received during a part-time medical leave, or a year-end salary adjustment.