Manage Cost Codes/Names

Cost codes are labels used to classify and group project costs (examples: Labor, Materials, Travel, Equipment). Each transaction or product can be assigned a cost code so you can track spending by category, compare budgets to actuals, produce accurate job-cost reports, and control financial performance at a granular level.

Cost codes are used by project managers, finance teams, and field staff to categorize project costs, track budgets, support billing accuracy, and maintain clear, reliable job-cost reporting.

Key points:

• Cost codes are the building blocks of project-level expense tracking and reporting.

• They feed into budgets, WIP, invoices, and profitability reports.

• You can create hierarchical structures (parent → child → sub-child) so a single top-level code (e.g., Labor) can roll up many more specific subcodes (e.g., On-site Labor, Remote Support).

Why cost codes are important

Cost codes play a central role in organizing project financials. By grouping expenses into meaningful categories, they make it easier for teams to plan accurately, monitor performance, and maintain financial control throughout the project lifecycle. They also:

Accurate budgeting: Assigning costs to codes makes it possible to create and monitor budget lines per activity or resource.

Better forecasting: Roll-ups and summaries let managers see which parts of a job are trending over or under budget.

Clear reporting: Cost-code-based reports show where money is spent and support client billing, internal review, and audits.

Chargeability & margins: When combined with time and billing data, cost codes help compute gross margins by cost category.

Operational control: They enable rules (inclusions/exclusions), internal approvals, and automated allocations for procurement or equipment use.

Standardization across projects: Using consistent cost codes ensures all projects follow the same financial structure, making cross-project comparisons easier and improving firmwide reporting accuracy.

Add and Manage Cost Codes

Use the following guides to complete specific actions related to Cost Codes and project financial structure:

• Add a New Cost Code Use this guide when you need to create a brand-new, top-level cost code for budgeting or reporting.

• Guide on Adding a Sub-Cost Code Use this article when you need to build hierarchical layers under a parent cost code (up to three levels deep).

• Use Cost Types Refer here when you need to define or update cost types such as Labor, Materials, or Equipment and apply them to cost codes for more detailed financial tracking.

Creating and maintaining a clear, consistent cost-code structure ensures accurate budgeting, simplifies reporting, and helps your firm control project spend and margins—so set sensible hierarchies, enforce naming rules, and train your team to use codes consistently.