We do monthly PM meetings on every project through final payment receipt, then do a project close-out meeting.  We schedule the PM meetings mid-month and the agenda includes over/under billings and net cash flow calculated within a few days of the meeting.  If there's an under billing or a lower than expected cash flow at the meeting, the PM and project get put on a "watch list" company wide and an action item created to resolve both.  The "watch list" gets checked again at month-end when I do the final invoice and payment postings for the month, long before I'm producing monthly financials.  This way every project gets scrutinized at least twice a month and I can noticy the PM that action needs to occur yet before their next PM meeting.

If under billings or stressed cash flow continue without explanation to the next PM meeting, the PM is held accountable and needs to provide an explanation and formal plan to correct, which can and does involve what ever resources are needed from the company.

This has been effective for us because no one likes to be on a "watch list" or hold a subsequent meeting and have a red mark not yet resolved from the last meeting.

We're a GC and don't do service work, but if we did, I'd suggest we treat service work as any other project and hold a monthly meeting for the entire group initially, then give additional time and resources to resolve problematic areas as needed.

I think the key is to use the technology and computer resources you have to effectively and frequently monitor these issues and make it part of your culture.  When I started with the company, there wasn't a single person other than the controller that knew how to calculate an over/under billing.  They still don't, and I don't expect them to, but they are expected to understand that it's a good scorecard item indicating the successful progress of a job and it needs to be taken seriously.

Kevin,

Instead of placing the responsibility solely on the PM in charge of the small jobs (typically service-oriented jobs), I had our A/R department work in a support capacity to insure that small jobs weren't missed.  We set up weekly reporting process in Timberline that reported costs incurred for each small job or service order.  The A/R department set up a suspense file for each job/order.  Each week, the PM and A/R statused each job/order as "completed" or "ongoing".  Completed jobs were billed immediately.  Open jobs were progressed billed at the end of the month and then final billed upon completion.

Best regards,

Bill

We conduct a montly meeting with each manager with two items on the agenda; collections and billings.  Managers are directly involved in insuring prompt payment by our customers so an ageing is reviewed.  A work in process schedule that lists costs and billings is reviewed to check for underbilled jobs or costs not posted. 

 Managers recieve these reports a week ahead of time so they can contact customers and PM's to prepare for the review.

 Works for us.

 Jack

One method I have seen be very successful is to use an email notification system.  Essentially the email notifier system would monitor the cost and billings on all the projects.  Then the day before the billings are due, the email notification system looks through all the job costs and billings.  On any job that had cost during the billing cycle and did not yet have a billing in the system, it would then send a reminder to the Project Manager to let them know they had a billing they need to complete.  This is especially useful on projects that are near completion where the PM may not be involved on a day to day basis and might not even be aware that billable work has been done on the project. I am not sure what accounting system you are running, so this may or may not be an option.

For T & M jobs, we have a Timberline Report that Prints Total Weekly Cost by Category which is then used to alert Billing to invoice the jobs that show billable cost.

For L S jobs, we print a numerical listing of jobs at month end that is sent to PM for their % Complete, when returned it is billed.

I, like the other respondent, have set up a flash report that is run monthly and distributed to all project managers whether they have small or large jobs. That report includes two jobs per landscaped legal sheet and includes the following for each job:  contract amount, estimated costs, estimated profit, percent complete, actual costs to date, actual billing to date, a over/under billing calculation and then an outstanding accounts receivable balance on each project. The report also has last cost date and last billing date reflected upon it.  We have a row for "per the accounting system (Timberline)," per project manager (smokes out unrecorded change orders) and then a variance between the two.  They get one of these each month to mark up for all of their work including large projects.  Most turn it around in +/- 30 minutes; some struggle a bit.  Before this was implemented we were NOT billing +/- $50k of work per year and our margins on what was being billed was not where it needed to be.  Post implementation (3 years) we have left nothing unbilled and our small job margins on a whole are up about 6%.

Shoot an e-mail to jimm@garco.com requesting Timberline Flash Report format and I will send a sample format to you.

Jim Morrison

Kevin,

Age old question with no simple answer.

I had to start keeping my own log as I became aware of these so called "small" projects, usually based on casual discussions with PM's and Supt's. Then the week before invoices were prepared I had to sit each PM down and go through the list and get them to cough up the information.

After the billings were released I would send a small report to the PM and copy his boss on the "impact" the "small" jobs could have had on profitability had we not caught it.

Once the boss became aware of the problem, the information from the PM's became rather free flowing and we established a formal process and procedure that ran very smoothly and cut the losses from unbilled work by 95%.

The key to solving the underlying problem is to enlist the assistancc of the boss by showing the drain on profitability had you not caught these small jobs, otherwise you will be chasing your tail around the office forever.

Remember money and profitability talks, and ** walks.

I do mostly Controller by the hour services, and with one client, I created a simple report that looks at contract gross versus billed to date, and prints only if there is a difference.  This would assume that a contract amount has to be entered into your accounting system, otherwise a zero contract with no billings would not print.  It's a rough backlog report but has been effective.