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ERPNext Timesheet Management: How to Track Project Activities and Costs Effectively

ERPNext timesheets help track employee hours, manage project activities, control costs, streamline billing, and boost productivity for service businesses.

October 16, 2025 · 4 min read

For service organizations, the effective tracking of project activities is one of the most important components for success. If the work hours of employees are not recorded accurately, it is difficult to evaluate capabilities like project timelines, cost controls, and billing the client properly. This is where the timesheet features in ERPNext are invaluable. When you combine Employee Time Tracking in ERPNext with project cost tracking, you have total visibility in terms of how your projects are getting done.

What are the key ERPNext timesheet features?

ERPNext Timesheet is more than just a tool to record working hours; it’s a practical system that connects your team’s work, projects, and finances in one platform. It improves time tracking and adds more clarity to everyday operations.

Key and Updated Features of ERPNext Timesheet:

Task-Based Time Entry: Employees can record hours for each task or project, making work tracking simple and organized.
Real-Time Project Tracking: Managers can easily view project progress, team workload, and cost usage.
Smart Costing & Billing: The system automatically calculates costs and billable hours based on preset rates.
Payroll & Invoicing Integration: Timesheets link directly with payroll and client invoices to save time and reduce manual work.
Built-in Timer: A live timer lets users track active work sessions with accurate time logging.
Improved Data Accuracy: The latest updates make sure only valid project tasks appear during entry, reducing errors.
Budget & Cost Control: Compare planned and actual hours or costs instantly to stay within limits.
Detailed Reporting: Dashboards provide insights into project hours, billable work, and team performance.

With these updated features, ERPNext Timesheet gives businesses a clear and practical way to manage time, control costs, and keep every project on track.

How can you manage timesheets in ERPNext step by step?

Tracking employee hours can be tough, but ERPNext Timesheet keeps it simple and structured. Teams can log their daily work, connect hours to projects and tasks, and give managers and finance teams full clarity. From recording time and tracking project costs to approvals, payroll, and billing, everything happens within one system, providing accurate records and a structured workflow.

Setting Up Projects and Task Lists

Begin by creating a clear structure for your work.

Add your projects in ERPNext and break them down into smaller tasks.
Create activity types such as “Development,” “Testing,” or “Client Review.”
Assign employees or departments to each project or activity.

This setup makes it easy for everyone to know exactly where to record their time.

Logging Work Hours

Once the structure is ready, employees can easily log their work. Each time entry includes:

The task or activity they worked on
The number of hours or the start and end time
The project it belongs to

Tracking Cost and Billing

ERPNext automatically calculates the cost of the time spent and the amount to be billed to the client.

Cost Rate: How much it costs the company for that employee’s time.
Billing Rate: The rate charged to the client for that time.

This feature allows management to track project costs, profit margins, and budgets in real time.

Submitting and Reviewing Timesheets

After logging time, employees submit their timesheets for manager review.

Managers verify the accuracy of hours.
Approved timesheets are locked for payroll and billing.

This process reduces manual errors and keeps time records accurate.

Analyzing Time Reports

Once approved, ERPNext provides detailed reports and dashboards showing how time is utilized.

Managers can identify which projects take more time.
The finance team can prepare invoices directly.
HR can link approved timesheets with salary processing.

This gives every department a clearer view of productivity, costs, and project performance, all within a single system.

▶️ Watch this video tutorial for a step-by-step walkthrough:

https://youtu.be/LSDog0rQiJs?si=ZkJpRF36_p7y9upB

What are the benefits of ERP services for timesheet management?

An ERP system does much more than just track time or expenses. It connects everything your business needs from time and costs to payroll and billing in one place. This means everyone works with the same, accurate information.

Here’s how it makes a difference:

Saves time: Employees don’t have to waste hours filling reports, and managers don’t need to combine data from different sources.
Controls costs: Every expense is linked to a project, so you can see where money is going at any moment.
Builds trust: Accurate and transparent billing keeps clients confident in your services.
Uses resources wisely: Managers can easily find where staff time is being overused or underused.

For industries like IT, consulting, construction, and design, ERPNext is especially helpful. It makes managing projects easier, keeps budgets on track, and strengthens client relationships through better visibility and communication.

How can ERP be implemented across different industries?

ERP systems are flexible tools that can be used in many different industries. In manufacturing, for example, ERPNext Project Management helps manage raw materials, production timelines, and quality checks. In healthcare, it helps track a patient’s care process and makes sure staff and resources are used properly. In construction, ERPNext helps keep track of project costs so contractors can stay within budget. Because it can be adapted to different business needs, ERP is useful for almost any organization that wants better control and smoother operations.

Conclusion – Making Every Hour Count with ERPNext

Time tracking may seem like a routine task, but with ERPNext, it becomes a strategic tool for improving efficiency, managing costs, and boosting project performance. By linking timesheets directly to projects, billing, and resources, businesses gain a clear view of how every hour contributes to overall success.

With guidance from Wahni IT Solutions, companies using ERPNext in Bangalore can simplify workflows, make informed decisions, and transform everyday time entries into actionable insights. ERPNext turns simple work logs into a strategic tool for growth and productivity.

Take the next step today, partner with Wahni IT Solutions to implement ERPNext and unlock the full potential of your business operations.