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Agree 100% with Dani Bennett on this. We have to track a lot of expenses and associated revenue on a per project basis via excel spreadsheets - with duplication of data entry and potential for manual mistakes - because the tools I need are not built into Projects.

It's the biggest challenge I have with Xero and the only reason I have to consider what accounting software options we might have elsewhere.

Yes please invest more in Projects! Many clients opt out of Xero Projects and purchase other subscriptions as the functionality (including reporting to show project costs split by nominal codes) is limited.

We use Xero Projects to manage work in progress (WIP) for our clients. At present, there is no report that shows project expenses broken down by the nominal account (general ledger account) they have ultimately been allocated to.

Description of the problem

Preparing our management accounts currently involves a significant amount of manual work. For each reporting period, I have to spend around three hours manually reconciling reports by:

Running an account transactions report for our WIP account.
Going through each individual project to identify which expenses relate to that project.
Determining which expense account each cost should ultimately be transferred to.
Manually reconciling multiple reports to calculate the correct WIP balance.

This process is time-consuming and increases the risk of manual error.

How we would use this feature

We would like a report that lists project expenses by both project and general ledger account code.

This would allow us to:

See the total costs incurred on each project.
Identify which nominal account each expense belongs to.
Calculate the true work in progress balance for each project.
Produce more accurate monthly management accounts without relying on manual reconciliations.

Impact on our business

A report with this functionality would provide significant time savings by removing around three hours of manual reconciliation each reporting period.

It would also improve the accuracy of our financial reporting by reducing manual intervention and ensuring that work in progress is allocated correctly between the balance sheet and profit and loss account. This would enable us to produce more reliable management accounts and make the month-end process considerably more efficient.

also piggybacking off this one,

**Feature suggestion: Draft invoices should not appear as “Invoiced” in Xero Projects until approved**

In Xero Projects, invoice line items assigned to a project currently appear as “Invoiced” even when the invoice is still in **draft** status.

This creates a major reporting issue for construction businesses and any business that uses staged billing, contract milestones, progress claims, or forward-planned invoicing.

For staged construction contracts, we often need to prepare draft invoices in advance for agreed contract stages, such as deposit, slab, frame, lock-up, fixing, practical completion, or variations. Drafting these invoices ahead of time is part of good project administration.

However, a draft invoice is not an invoiced amount.

It has not been approved, issued, sent to the client, or become payable. It is only a prepared document.

When Xero Projects counts draft invoices as “Invoiced”, the project report becomes misleading. It makes it look like the project has already been invoiced when it has not. This can distort project tracking, confuse staff, and make the project financial position inaccurate.

This is especially problematic where the project budget, costs, invoiced amount, and profitability are being monitored throughout the job.

A better solution would be for Xero Projects to separate invoice statuses inside project reporting, for example:

* Draft invoices
* Approved invoices
* Sent invoices
* Paid invoices

The “Invoiced” total in Xero Projects should only include approved and/or sent invoices, not draft invoices.

Alternatively, Xero could allow users to choose whether draft invoices are included in project invoiced totals.

This would make Xero Projects much more accurate and useful for businesses that rely on staged billing, contract milestones, progress claims, and advance invoice preparation.

**Business impact:**

For construction businesses, this affects live job reporting, staged contract administration, internal decision-making, and financial visibility. Draft invoices being treated as invoiced income can make a project appear further progressed financially than it actually is.

Please update Xero Projects so draft invoices are clearly separated from actual invoiced amounts.

This is essential to reconcile project transactions back to the nominal ledger, to ensure this reconciles to the work in progress calculations.