All Collections
Projects
Projects
What is a T&M contract line?
What is a T&M contract line?

Understand what a T&M (time and Material) contract line is.

Julie Bennett avatar
Written by Julie Bennett
Updated over a week ago

Updated 5th March 2024

T&M contract line in detail

A contract line is defined with a Name and a Line ID and it is always part of a Group. You can also further define your contract line with a description that will appear on the invoice.

PSOhub support four types of contract lines: Fixed Fee, Expenses, T&M (Time and Material), and Retainer.  

A contract line defined as Time & Material (T&M) will allow you to invoice the actual hours that have been booked towards a contract line. There is no fixed amount here, you invoice time spent. 

The financial information of a T&M contract line will be displayed in the four following fields: Amount, Budget (Sales), Budget (Costs), and Total Value.

Field

Description

Amount

This field is automatically populated by PSOhub with the value of the hours booked and, as such, can't be overwritten. This field is also leveraged in the process of billing.

Budget (Sales)

Represents your budget based on your selling rate. A T&M contract line would represent the budget/estimate you have agreed upon with your client.

Budget (Costs)

This field is optional and represents the budget based on your cost rate (internal budget). You can key it in manually or you can leverage the Budget Grid to update this field automatically.

Total Value

This field is leveraged in the calculation of the Total Project Value (General information section of your project page). It represents the value of the contract line, i.e. it equals the value in the Amount field.

Note: The value of hours booked towards a T&M contract line is always equal to the value in the Used column of the Contract tab.

Budget used alert

You will be able to define one or two budget alerts:

Once the value of hours booked towards the contract line reaches the percentage of budget defined for the first alert, a message will show in the Activity feed of your project.

If you have checked the Alerts box for any team member of your project, the alert will show up as a notification in their PSOhub account and/or in their email:

The overrun budgets alerts are highlighted in the contract. The T&M icon will become orange if the first budget alert has been reached. When the second alert has been reached the icon will become red. If you are only using one budget alert, the icon will simply become red when reached.

Deactivate line on budget overrun

In addition to the alerts, you can also check the function Deactivate the contract line on budget overrun which will prevent anyone from booking time once there is no budget left on the contract line.

The Active option will only appear once your project is set to Active.

As soon as you change the status of your project to Active, your contract line will also be set to Active and this box will be automatically checked. This will allow time entries to be made towards the contract line.

If you wish to prevent team members from booking time towards a contract line, simply uncheck this box and this contract line will no longer be available for entry.

Add as task list in tasks

This option will allow you to add this contract line as a task list to your project's task board if it's not already included in your project's task board template, or if you plan on creating your task board without any existing template.

Invoicing details

The Invoicing tab will allow you to define how to invoice the T&M contract line; whether Manually or Monthly.

If you need PSOhub to use a specific tax category or revenue account for this contract line, you will select it here.

When integrated to an accounting software, you can overwrite the default revenue account defined in the My Organization settings. You can select an alternative option in the GL Name / Article / Item / Service /Product drop-down list.

Click the Save button to save the configuration.

Related article

Did this answer your question?