Revenue forecasts setup [in-depth guide] – Workamajig

Before generating revenue forecasts, there are a few setup pieces to ensure your forecasts are accurate and include all desired data. The scope of this setup is dependent on how you want your forecasts to operate. However, it is best to review all the material below before starting the process in your system.

System setup

Security group rights

Admin/manager > System setup > Security settings

Enable the rights to 'edit/view revenue forecasts' and if needed, the right to 'view revenue forecasts from other AEs'.

Without this right, the revenue forecasts will not appear under 'Views' on the Today accounting page.

Revenue forecast tracking

NOTE: This section can be skipped if you do not wish to include opportunities in your financial budget.

Admin/manager > System setup > GL settings > GL tracking options > Revenue forecast tracking

These are only to be used if you want to include opportunities in your financial budgets.

In this area, you will designate the appropriate revenue GL account for each opportunity revenue category: labor, production, media, and cost. The system will then 'book' amounts entered in the opportunity towards these accounts for forecasting purposes.

Project status codes

Next, we need to look at how we would like to track projects in your revenue forecasts. This is done by project status.

Admin/manager > System setup > Global lists > Project status codes

The 'include in forecast' setting allows you to define which project statuses will be included in the revenue forecast.

Check the box for all statuses you wish to include in the forecast. This setting does not affect and is not affected by any other status code settings, it is specific to revenue forecasting.

Project setup

In order to include a project in the revenue forecast, certain components need to be set up within the project.

Project status

Project > status

Based on the project status code set in the system setup, the status selected in this area will determine if the project will be included in the forecast. When the project is set to a status code with the setting 'include In forecast', the estimate will determine if the values will be seen as an 'approved project' or 'potential project'.

Project estimate

Project > Setup > Estimates

Workamajig will consider estimates in 2 ways:

Approved: All approved estimates are included in forecasts regardless if 'include in forecast' is checked.
NOTE: If you have an unapproved estimate with 'include in forecast' checked in the estimate settings, the amount will be included in the forecast along with the approved estimate amount. Uncheck 'include in forecast' if you want to remove the amount from the forecast.
Potential: All unapproved estimates with 'include in forecast' checked will be included in forecasts.
NOTE: Estimate will only be included in a forecast if the following criteria are met: 1) Project status is set up to be included in the forecast, and, 2) Include in forecast is checked on the chosen unapproved estimates.

The forecast timing will be set in the following way:

LABOR: values will be set based on billing method and/or billing schedule.

EXPENSES:

If associated with task >> values will be set based upon the task. The timing will be set based upon the Task Plan Dates.
If NOT associated with task >> total value spread and timing will be selected on the revenue forecast report: Spread expense setting.

Project billing method

Time & materials

When the project status of the project is set to status to include in the revenue forecast, it uses the estimate marked to be included in the forecast to calculate the revenue forecast based on the task duration & service estimated for labor.

NOTE: For expenses, if the estimated expense is tied to a task(s), the task dates will determine the forecast timing. If there is no task, the revenue forecast report setting 'spread expenses' will determine how the expense is shown in the forecast.

Options: Forecast as fixed-fee: This is a checkbox in the Project settings > Billing options. With this selected, the time & material project will be viewed as a fixed-fee project. A billing schedule will need to be entered and the revenue will be forecasted based on the billing schedule and the project schedule will be ignored.

If 'forecast as fixed-fee' is selected; then the billing schedule must be entered.
Billing schedule: This defines the timing and amount that will be tracked in the forecast. A billing schedule allows you to set a percentage of the budget or a value along with the timing. The forecast will follow these settings. However, depending on the project setting for fixed-fee will determine how the system will track expenses

Fixed-fee

In general, the revenue forecast will be based on the project budget. However, for fixed-fee projects, there will be other settings that will allow you to set when to recognize a percentage of the budget.

Options: Forecast all projects as T&M: With this setting, the fixed-fee project will be looked at as a time & materials project. Any billing schedule settings will be ignored.

With billing schedule: This defines the timing & amount that will be tracked in the forecast. A billing schedule allows you to set a percentage of budget or a value to go along with the timing. The forecast will follow these settings. However, depending on the project setting for fixed-fee will determine how the system will track expenses.
When you set up the billing method, fixed-fee, there is a check box: 'expenses are not included'. This means that either your billing will see expenses as being included or not included during the billing process. The revenue forecast will work the same way.

Expenses included = Expense not included UNCHECKED > The budget is based upon the total current budget amount. The forecast settings for expenses will be ignored.

Expenses not included = Expenses not included CHECKED > The budget is based upon the labor only of the current budget amount. The forecast settings for expenses will follow the T&M method.

No billing schedule and option: Forecast all projects as T&M is unchecked: The project will be ignored and not included in the revenue forecast

Opportunity setup

For opportunities to be included in revenue forecast figures, the opportunity must be 'active' and have not been converted to a project/campaign.

There are two ways that Workamajig includes opportunities in the revenue forecast figures:

Opportunity without estimate.
Opportunity with estimate(s) with 'include in forecast' checked.

NOTE: Depending on the method you use, the data used by Workamajig will be a bit different.

Opportunity without estimate

This method is used when 'enable advanced features' has not been turned on or if it has been enabled and there is no estimate associated with the oppty-project. The fields on the opportunity that are used in the revenue forecast calculation are:

Total revenue: Total revenue is a calculated amount that includes labor + production + media.

Probability: Used to calculate the amount to forecast. Total revenue * probability = forecasted amount.

Forecasted close date: Used to determine the start date to begin adding forecasting figures for the opportunity.

Months: Used to divide the forecasted amount over X number of months. Forecasted amount/months = revenue amount per month.

Opportunity with estimate

This method is used when 'enable advanced features' has been turned on and an estimate has the 'include in forecast' box checked. The opportunity estimate will be included in the revenue forecast figures.

NOTE: The system forecasts all opportunity estimate figures using the time & materials method. It does not matter how the oppty-project is set up for the billing method. It does not matter if the estimate is approved or unapproved. If the 'include in the forecast' is checked, it will be included. You must uncheck for any estimates that you do not want to be included.

The settings used for revenue forecasting are:

Estimate total: All opportunity estimates that have the 'include in forecast' box checked.

Probability: Used to calculate the amount to forecast. Total revenue * probability = forecasted amount.

Forecasted close date: Used to determine the start date of the schedule for the opportunity project.

Schedule: Used to divide the forecasted labor amount over X number of months within the schedule. Forecasted labor amount/months = labor revenue amount per month.

NOTE: Expenses will be spread based on the selected forecast report 'spread expenses' setting.

Campaign setup

To include a campaign in the revenue forecast, certain components need to be set up within the campaign.

Campaign estimate

Campaign > Estimates

Approved campaigns: All approved estimates are included in forecasts regardless if 'include in forecast' is checked.
NOTE: If you have an unapproved estimate with 'include in forecast' checked in the estimate settings, the amount will be included in the forecast along with the approved estimate amount. Uncheck 'include in forecast' if you want to remove the amount from the forecast.
Potential campaigns: All unapproved estimates with 'include in forecast' checked will be included in forecasts.
NOTE: The include in forecast checkbox is displayed when the campaign bill is set to 'campaign' and the 'use campaign budget' is checked.

The forecast will consider the estimates in 2 ways:

Campaign estimate created by estimate type = Service - All applicable campaign estimates are included in the forecast.
Campaign estimate created by estimate type = Project - All applicable project estimates in the projects linked to the campaign are included in the forecast.

Campaign billing method

Campaign > Campaign settings > Bill by

When you set the campaign to 'bill by campaign' and select the checkbox 'use campaign budget', the campaign will allow you to set a billing schedule. For the campaign to display in the revenue forecast:

Campaign bill by must be set to 'campaign'
Use campaign budget box must be selected
A billing schedule must be set
A minimum of one estimate must be approved.

Billing schedule: This defines the timing and amount that will be tracked in the forecast. A billing schedule allows you to set a percentage of the budget or a value to go along with the timing.

When you set the billing method, 'use campaign budget', there is a check box: 'expenses are not included'. If the billing process is to 'bill actual expenses incurred on the projects', instead of the 'campaign budgeted expenses', then check this box. The revenue forecast will work for campaigns as it does for fixed-fee projects.

Expenses included = Expense not included UNCHECKED > The budget is based on the total current budget amount. The forecast settings for expenses will be ignored.
Expenses not included = Expenses not included CHECKED > The budget is based on the labor only of the current budget amount. The forecast settings for expenses will follow the forecast for how expenses are to be spread (spread at the beginning, the end, evenly or excluded).

Retainer setup

Retainers can be added to the revenue forecast figures based on the following settings:

Start date: Used to determine the beginning forecast period.

Frequency: Used to determine how often the per period amount occurs.

Number of periods: Used to determine the length or end period.

Amount per period: Used to determine the current value for each period.

Active: Determines the status of 'retainer'. Only active retainers will be used in the revenue forecast.

NOTE: Any invoices posted toward the retainer or towards a project included in the retainer will be excluded from forecasting figures.

Scheduled invoice setup

Scheduled invoices can also be included in the revenue forecast figures based on the following settings:

Invoice total without tax amount: (comes from invoice) Total amount to be used for forecasting purposes.

Invoice date: (comes from invoice) Used to determine the start date for revenue entries.

Frequency: Used to determine how often the period amount occurs. NOTE: All selections less than monthly will be added together to form a monthly total for reporting purposes.

Number remaining: Used to determine the number of 'monthly' forecast entries entered into the forecast.

Active: Must be checked to include in revenue forecast figures.

NOTE: Generated or current invoices associated with the 'scheduled' invoice will be excluded from the calculation.

Next steps

Add new revenue forecast

Managing revenue forecasts

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