NavigateERP for African business

Construction equipment hired by the hour

Daily meter usage, prepaid hours or monthly billing, the partner, the margin.

Steps

  1. Put the machine on an agreement as usual (rate per hour, hour meter) and dispatch it. On the agreement, click Hire by hours on the machine.
  2. Hire terms: choose the billing - Prepaid hours (a block, e.g. 200 hours at 7,000 = 1,400,000, invoiced up front) or Monthly in arrears (approved hours × the rate at the cut-off) - the customer rate, the usual block, and the operator and turn man day rates.
  3. Every working day: record the opening and closing hour meter, the operator, turn man, site and a photo of the meter. The opening must follow the last closing; a meter that went back, a gap or a day over 24 hours needs a reason (meter reset, rolled over, replaced) - a manager approves it.
  4. Approve the days (one by one, or all days without exceptions at once). Only approved hours count.
  5. Prepaid: approved hours use up the block - the page shows hours invoiced, worked and remaining (e.g. 200 − 165 = 35). The next block is invoiced only when they are used (or down to your alert); hours worked beyond the block are covered first by the next. A manager may raise one early, with the reason.
  6. Monthly: at the cut-off, Invoice approved hours - e.g. 126 h × 7,000 = 882,000 - for every machine on the agreement billed this way, on one invoice. Pending days are not billed, and nothing is billed twice.

Good to know

  • A machine billed by hours is left out of the agreement's standard billing - it is billed by its blocks or its monthly hours.
  • Accounting - prepaid blocks: the invoice is receivable at once, but hours not yet worked are a liability, not revenue. The block's revenue moves to 2330 Hire invoiced in advance and each approved day releases its hours × the rate back to revenue. Monthly billing is invoiced after the work, so it is revenue straight away.
  • Accounting - the crew: choose Casual (accrued, Cr accrued expenses - pay them later) or On payroll (moved from salaries to the hire's cost of sales, so the payroll run is not counted twice). The margin is on earned revenue - approved hours × the rate.
  • Ownership: an owned or co-owned machine is in the fixed-asset register (co-owned: at your share of the cost) and depreciates there. A machine hired in from a partner is not yours - add it as an owner's asset (not from the register) and set it to hired in. A partner settled without their invoice number is a draft supplier invoice: in the margin, but not in the books until posted.